From the record hunter to the correction-candidate: Only a week after his most recent record for the Dax at the threshold for a correction. Almost ten per cent has lost, the stock market barometer from its all-time high of 13.795 in just five trading days - and it could go further down. DAX 12.268,27 PTS. -506,61 (-3,97%) Xetra

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For investors in the U.S. stock exchanges February in addition to a terrible Deja-Vu. Just like in February 2018, the Dow Jones fell to a single day of trading in more than 1,000 points, at the time, however, the same twice. Still, the Dow has shown in the past few days, his third - and fourth-highest daily loss (in points percentage).

where is the panic?

investors are fleeing currently, out of fear of a full-braking of the global economy, the markets, caused by the spread of the novel Coronavirus COVI-19. This is the big difference to similar dramatic price decline in February two years ago. At that time, the economy was not too good, so the investors were a inflation jump and the end of cheap money by Central banks.

The COVID-19-cases in Europe have increased in the past few days, suddenly, though it had for weeks seems that the epidemic is limited to the place of origin, China. Currently, worldwide there are more than 82.300 cases, a little over 2,800 people have succumbed to the disease.

Thus, the mortality is lower than in previous Epi - and pandemics, such as SARS at the beginning of the Millennium. But: COVID-19 has expanded more than ten times as strong as SARS. Extensive quarantine measures and a subsequent Halt of the economy and of public life – seem inevitable. Small Caps Champion: your 3 pillars for a successful wealth accumulation. Successfully and safely in addition to values invest. (Partner quote) Here is an exclusive free trial!

How bad could it hit our economy?

After the recent increase in cases outside of China experts from more significant consequences for our economy, more and more. "I am every day alerted, since the Virus does not limit, but rather expands. Also on Europe and in particular Italy,“ said about the President of the German Institute for economic research (DIW), Marcel Fratzscher, compared to ntv.

According to Fratzscher, a permanent damage for the German economy is threatening to fall apart with high probability "". The Virus "hits the German economy at the worst possible time, because the German economy is lame," said Fratzscher. The Economist calls, therefore, for a more active Intervention by the policy – in order to compensate for such investments, the failures in the private sector. "At least now would be the time to say that spending more money," said Fratzscher.

The agrees Carsten Mumm, chief economist of the private Bank Donner & Reuschel, in. His prognosis: In the case of large-scale quarantines and loss of production "would be in Germany, negative growth in the first quarter, probably." Mumm is also expecting that the expected profit is not increased by an increase in Dax-listed companies because of it.

As it goes to the stock exchanges?

For the markets are the worst possible prospects. Further losses are likely, the assessments of the experts of the Berenberg Bank show, for example. In addition to the weak growth prospects, the shares are currently quotas in the case of many investment strategies "in the historical comparison of high to very high," wrote Bernd Meyer, the chief strategist of asset management at Berenberg, as well as Ulrich Urbahn, head of Multi-Asset Strategy & Research, in a comment.

Further setbacks would force some of the strategies for a reduction of the share positions, accelerated of course by the descent of the courses. "But also panic sales by retail investors cannot be ruled out", added the expert. With Stock Selection in Europe, you will achieve excess Returns with System! (Partner offer) Now 30 days free of charge test!

the the plain is likely to fuel downward momentum from the technical side ends of the Tear means. Supports to wait in the area between 12.373 and 12.015 points.

What does this mean for investors?

However, this does not mean all investors should now actually give up their equity positions. As the rate of return triangle of the Deutsche aktieninstitut (DAI) and, most recently, a study by the asset Manager DWS documents, tend to evaluate the yields in the long term, to a solid medium, practically regardless of the actual investment period.

Means: if you take precautions for retirement with stock, can sit by and wait for the correction. Of a hasty sale, the Berenberg experts Meyer and Urbahn rates anyway. "Phase of panic sales we consider to be a bad time to have shares to reduce risk," wrote the professionals.

Also, noted Meyer and Urbahn that there is, in the medium term is still a good chance for shares. So there had been, in spite of strong stock markets to 2019-strong outflows in equity investments, many investors took the Rally "or even" the "in front of this Background, and given the reduced political risks, any signs of stabilization of Economic activity lead to significant inflows for equities."

With the end of the first reporting season this year, is expected to start purchases in the US, many companies with new shares, wrote Meyer and Urbahn. The offer the rates support. Least of all Central banks and governments are likely to be "at elevated risk of an economic slowdown, monetary and in particular fiscal policy - active".

What options do I have as an investor?

investors need not stand idly by, even if it appears to make sense, not to let the panicky markets are unsettled. For investors who still wish to have quieter nights, it offers a hedge via Put option to seem – more information here. However, hedging costs, and if the market turns remain investors in these costs.

Seema Shah, chief strategist of Principal Global Investors, advises investors to precious metals such as Gold: "The prices have risen in the last two months, but you could still continue to rise, if the search of the investor stops for safety." On the equity markets, defensive sectors such as utilities, real estate and Health Care are likely to say, compared to the broad markets, so the experts. "We favour also the quality of the shares and, in particular, large companies. In contrast, investors should raw materials, their commitment to the Industry, luxury goods, and European airlines to minimize. Although the Asian airlines were initially the most affected, but with the recent development in Italy of the European Airlines, the next Domino could be the stone that falls."

Appropriate for long-term savers, it seems, to remain calm. Conceivable the Purchase of the now cheaper stock is here, even as it advises Michael Winkler, chief investment officer at St. Galler Kantonalbank: "investors should watch the action closely and consider, to take advantage of price declines for inventory increases". History has shown the outbreaks of SARS and bird flu, according to Winkler, is that "an economic slowdown was reversed in the rule in subsequent quarters."

topic: Despite virus concerns - investors beware: take a look at these strong China shares

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