Don't increase your equity allocations

Better bargains may be available in the next few months

Amid the panic caused by COVID-19, crude wars and the YES Bank crisis, one thing is certain: Q4 (January — March 2020) will be worse than Q3 (October-December 2019). Corporate earnings will take a hit across the board. It’s safe to assume that Q1, 2020-21 will also be pretty bad.

Even if the pandemic is contained soon, it has already done enough damage to knock the global economy into a lower medium-term trajectory. The impact of China’s lockdown was felt across global manufacturing. Now, with the EU badly affected, cases in the US and other advance economies, and visa cancellations everywhere,