Artisan Canvas Header Background
Artisan Canvas
Your reply has been posted successfully!

Navigating Volatility in Global Equity Markets

01 April 2020   |  

As the COVID-19 pandemic continues to drive heightened uncertainty and historic daily volatility, we thought an update may be appropriate. We are closely monitoring this rapidly evolving situation, remaining focused on our deep company analysis in order to understand the impacts to businesses’ growth outlooks, as appropriate. As this crisis has unfolded, companies have revised their revenue and earnings outlooks sharply lower. While supply-chain disruptions emanated from China as early as January, the economies of Western Europe and the US are just now experiencing their corresponding demand shocks. Government measures to slow the virus’s spread (i.e., social distancing) are leading to a rapid deterioration in business activity. As these measures may be in place for several more weeks, access to capital and liquidity will be imperative for companies to make it through the worst of the crisis. In order to continue successfully navigating the current environment, we believe it is important to focus capital in companies with the most visible growth prospects, sufficient access to liquidity and resilient business models. 

Since the founding of our investment team 24 years ago, financial markets have gone through several periods of extreme fluctuations—most notably during the tech bubble and 2008 global financial crisis. We have always remained extremely disciplined to philosophy and process, particularly during environments where discipline and focus are paramount to successful outcomes. Our portfolio leadership is supported by a deep and experienced team of research analysts, each of whom has significant knowledge within their sectors/regions of expertise.

From a business continuity standpoint, we have taken the necessary precautions to ensure the safety and well-being of our professionals. Travel and in-person meetings have been replaced with conference calls and video conferencing. Operating out of four different locations, our team is well-versed in working remotely. The ability to interact over phone and video, conduct research, and make decisions and implement them is business as usual. The team has had several research update meetings in recent weeks with most analysts calling in remotely, and our traders are fully operational with home workstations with back-up equipment available if needed at our offices in San Francisco, New York, London and Milwaukee. To date, COVID-19 has not had a material impact on our team or critical functions.

This has been one of the greatest selloffs in history, in terms of both speed and magnitude. However, from our experience, it is times such as these that have offered the best opportunities to invest in companies that are mispriced relative to their underlying values.

  • Global Equity
  • Insights

Contact the Editorial Staff

Have a question or comment? We welcome your feedback. Comments will not be made public, but will be read by a member of our editorial staff.