Research Article
The Impact of COVID-19 on Portfolio Investment: An Empirical Study on Traditional and Innovative Asset Classes
@INPROCEEDINGS{10.4108/eai.9-12-2022.2327653, author={Leyan Li and Li Zhang and Zhu Zhu}, title={The Impact of COVID-19 on Portfolio Investment: An Empirical Study on Traditional and Innovative Asset Classes}, proceedings={Proceedings of the 4th Management Science Informatization and Economic Innovation Development Conference, MSIEID 2022, December 9-11, 2022, Chongqing, China}, publisher={EAI}, proceedings_a={MSIEID}, year={2023}, month={3}, keywords={covid-19 global equity index portfolio investment traditional assets innovative assets}, doi={10.4108/eai.9-12-2022.2327653} }- Leyan Li
Li Zhang
Zhu Zhu
Year: 2023
The Impact of COVID-19 on Portfolio Investment: An Empirical Study on Traditional and Innovative Asset Classes
MSIEID
EAI
DOI: 10.4108/eai.9-12-2022.2327653
Abstract
This research examined the impact of the COVID-19 pandemic on different asset classes. The main focus was on traditional assets such as gold and innovative assets such as bitcoin. The time for the study was divided into three: pre-covid, during covid, and post-covid to help effectively determine how the assets classes reacted to the pandemic. The modern portfolio theory was used to help obtain the best asset weights of the portfolio that maximize the hypothetical returns. The Sharpe ratio was used to measure the performance of asset classes in all the three-time periods. The results revealed that Bitcoin was relatively volatile during the experiment time span, whereas the gold ETF was the most stable asset. The portfolios also exhibited different performance to the individual traditional and innovative asset classes. For instance, the portfolio consisting of all traditional assets was more stable throughout the pandemic whereas the innovative assets fluctuated over time. Therefore, investors should consider investing in traditional asset classes such as gold EFT to achieve hedging benefits during health crises.