Value investing is difficult enough in benign environments, but in the current circumstances, it is proving particularly challenging. Suddenly, consumers are confined to their homes and global demand for many products has moved close to zero, with the exception of medical supplies and groceries.
Investors hate uncertainty. When faced with such extreme risk and uncertainty, their first instinct is to flee. The stock market has been a conduit of fear in recent weeks, which is perfectly understandable given the chaos that surrounds us.