The coronavirus has already changed the world and this must be understood as soon as possible as it creates historical investment opportunities. The virus changed the financial and business models. It has changed the economic development models. It changed consumer behavior and greatly enhanced digital communication channels.

In the age of Covid19, technology companies have proven to be as important to the economy as the energy that drives traditional industry.

For the past two months, the global economy has not been driven by energy. It has not been driven by factories. It was moved and kept alive by the infrastructure provided by the technology companies.

In the last 18 months, many have wondered why Apple, Google, Microsoft and other tech giants are constantly scoring historically high. I think the answer is absolutely clear today. If we remove the top five technology companies from the S&P 500, the losses will reach over 50%. A comparison of the S&P 500 and the Nasdaq shows that the future is digital.

Estimates for the technology industry

Coming out of the crisis of Covid19, the technology industry is gaining in the long-term as from now on, it’s not only necessary but is expected to be the best ‘gun’ of the companies in the world, in their battle to increase profitability.

I refer to the following example: Morgan Stanley’s boss said he was surprised and at the same time fully satisfied that such a complex and large bank had managed to cope fully with 90% of its employees working from home. Not only that, but he wondered if it made sense to start the “Morgan Stanley community” project, which would cost $ 2.1 billion.

Digital is expected to prevail everywhere. Consumer behavior has changed forever. Retail companies are facing a new era in which I estimate that they will increase their profitability. I expect them to increase their profit margins by intervening in two areas that have high costs.

First, they are expected to close tens or even hundreds physical stores and secondly because they will proceed with thousands of staff redundancies sooner or later.

How technology has changed consumer behavior

Over the past two months, businesses have seen that they can be just as effective with fewer staff. Also the online sales model has been optimized to the fullest. Below, there is a comparison of the performance of companies based on online sales (relative term: clicks) versus those based on sales through physical stores (relative term: bricks).


The “clicks” ETF has gained 33% since the beginning of the year and the “bricks” ETF has lost 20%. This trend will be established in the future.

Post-Covid19 era in investment portfolios

Like any other crisis in the past, it will pass. The reality is that things have turned out differently than what 90% of market participants expected.

A typical balanced portfolio, as of February 10, had an average annual yield of 12.06% for five years. Today it has 6.3%. It’s clear that investors need to do their part at this juncture, as they could be in a significant position for the next five years.

A portfolio can be set up in many ways. Below I give you an idea of ​​how an investor might think.

A portion of the portfolio can be invested in companies that were strengthened during the #stay_home period, which seem to be present and at the end of quarantine. These are technology, shopping, ready meals. Another part of the portfolio could focus on the sectors that will rise when consumers, companies and the government start spending again. Health sector, infrastructure sector and consumer goods sector, especially those that are necessary in our daily lives. Finally, a bit of risk could be based on the idea that the Fed will save whatever industry needs it, so the options are clear in the post-Covid19 era.

In 2020, it is starting to look more and more like 2009 (our main scenario since the beginning of the crisis) and this needs to be properly assessed.