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Further reading: Making sense of the upside-down

In an upside-down market, bad news can function as good news for investors
Further reading: Making sense of the upside-down
  • Bad news, such as the arrival of a global pandemic, can function as good news for investors, O’Shaughnessy’s Jesse Livermore argues 
  • When policymakers commit to using fiscal policy alongside monetary policy to help boost the economy, markets have good reason to turn upside-down 

Fans of hit Netflix series Stranger Things will be familiar with the concept of ‘The Upside-Down’ - a parallel dimension to Earth dominated by unpredictable and often hostile forces, who in turn are governed by a malevolent superbeing. 

In 2020, investors should be able to relate to the idea of an upside-down world. Recent vaccine developments flipped the market on its head once more, with so-called ‘winners’ of the pandemic flying into reverse after a year of gains fuelled by unique trading conditions. Governments – our own superbeings – have shovelled capital into economies in order to keep companies and jobs afloat. O’Shaughnessy Asset Management’s 'Jesse Livermore' (a pseudonym presumably inspired by the father of day trading) has penned his own epic on upside-down markets, examining the case for bad news functioning as good news for investors, and vice versa.

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