The extremely volatile phase began with the Corona crash in March, followed by a slow comeback and a summer in which Germany’s No. 1 share index mostly moved sideways.
With the news of a breakthrough in vaccine development, new price jumps followed this week. For Jörg Rosowski a foreseeable development: “It is a rational reaction of the market”, says the head of the world’s first securities search engine Algooo. “But there are plenty of other price-moving factors such as buy and sell programs. Short sellers have to stock up on their incorrect positioning, et cetera. The investor and not the stock exchange usually reacts irrationally. The topic can be complex, but it doesn’t have to be. “
The dilemma of many investors: In boom phases everyone wants to be there and not miss anything, in downturns one wants to protect oneself from too big a slump. “Volatile phases can be perceived as emotionally very stressful by investors,” says Rosowski. “Either through losses actually suffered or through profits not achieved and thus the stress of not having been there when the stock market recovered.”
New technologies such as the Algooo search engine allow investors to find just the right level of risk. After the user has entered their preferences, the algorithm starts working and compiles a portfolio. In addition to billions of potential investment opportunities, criteria such as individual crisis resistance are also examined. “At Algooo, the investor can see how the portfolio has behaved during the respective crises and how it has recovered after the crisis,” explains Rosowski. “This gives a transparent and comprehensible basis for which portfolio mix he chooses. We call this the robustness and recovery check. That can then lead to a stress-free interaction. “
Because nobody can know when the next crisis will come. “Every crisis has a different cause. The pattern, however, is that, among other things, stock indices usually fall and cause losses, ”said Rosowski. “If a portfolio you are looking for has already survived several, very different crises, the probability of surviving the next crisis is statistically higher. So every crisis is basically nothing more than a completely normal event. “
If you leave your investment decision to artificial intelligence, you don’t need to worry about a vaccine or the presidential election in the USA. Because the software knows no emotions. “Such events are only data points for the technology, there is no emotional connection to these topics. For the algorithm, this is only a neutral, negative or positive event that can be processed and included in the selection. “
Interested investors can have their custody account checked free of charge at Algooo, track down hidden costs and track down the investment products that are best for them. Further information are available here.
Author: Julian Schick, wallstreet: online Zentralredaktion