RESOURCES FOR VOLATILITY
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COVID-19 and the impact on the U.S. economy

Chief U.S. Economist Lara Rhame’s new research note on potential knock-on effects of the virus.

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Latest blog: COVID-19 and the impact on the U.S. economy

Chief U.S. Economist Lara Rhame’s new research note on potential knock-on effects of the virus.

Investment-News_Research_@2x_Email_600x600.jpgEfforts to contain the spread of COVID-19 in the U.S. are resulting in shuttered businesses and an unprecedented dislocation of economic activity. Given the nature of the crisis, certain areas of the economy are likely to be hit hardest.

We attempt to measure the immediate impact of specific industry shutdowns as well as outline uncertainties around knock-on effects on consumer spending, business investment and efficacy of government stimulus.

Where has all the diversification gone?

A new research series on finding diversification amid the crisis.

Investment-News_Research_@2x_Email_600x600.jpgThe recent wild swings in markets are testing investor portfolios for the first time in a long while. Many investors may find themselves less diversified than they had hoped as many asset classes have moved in virtual lockstep.

In this research note, we discuss why many traditional sources of portfolio diversification have failed – and highlight the choices we see for effective diversification going forward.

Seeing and solving the diversification crisis.

Get the full report
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Volatility is unrelenting, even as Fed accelerates easing

Chief U.S. Economist Lara Rhame breaks down what to watch as economic data starts catching up to COVID-19 headlines.

Investment-News_Research_@2x_Email_600x600.jpgPolicymakers are racing to try to blunt the coming economic shock related to COVID-19. Despite their best efforts, however, market volatility has been unrelenting in the face of unprecedented uncertainty. The Fed has rapidly cut rates to the zero lower bound and added liquidity in a variety of ways, and fiscal policymakers are framing out a stimulus package. And yet, on Monday, investors had to contend with another punishing sell-off.

We dig into the Fed’s latest move, what to watch as economic data reports start to reflect COVID-19-related activity, and why investors could have to contend with volatility for months to come.

Read more from Lara Rhame.

Read the blog
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COVID-19 widens reach into U.S., causing market volatility to surge

Chief U.S. Economist Lara Rhame’s updated breakdown of the virus and market volatility.

COVID-19 broadened its reach into the U.S. this week, sparking the sharpest equity market sell-off in a decade. Interest rates have also fallen to record lows as investors flood into safe-haven assets. We offer an update on U.S. economic risks and resiliency as well as potential further policy response. Uncertainty is likely to remain heightened despite policymakers’ efforts at being proactive, meaning investors should brace for further volatility for months to come.

Get our update on real and potential impacts of COVID-19 on the markets and economy.

Read the blog
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COVID-19 touches down in the U.S., the Fed cuts rates and markets shudder

Read why investors may be facing ongoing volatility and greater challenges finding income.

COVID-19 surfaced in the U.S. last week, adding immediate relevancy to the waves of negative news about the rapidly spreading coronavirus. In the face of skyrocketing volatility, the Fed cut rates 50 bps in an effort to smooth market jitters and bolster the economy. We check in on the market reaction, U.S. economic risks and resiliency, and potential further policy response. Despite policymakers’ efforts at being proactive, investors will likely need to navigate volatility for months to come.

How effective can Fed rate cuts be against the coronavirus?

Read the blog to find out
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COVID-19 impact on corporate credit markets

We take a look at current corporate credit market impact and the best course of action we see for investors going forward.

COVID19_credit_@2x_Email_600x600.jpgNews surrounding the coronavirus has dominated headlines in recent weeks and the outbreak has now spread to as many as 50 countries, stoking fears of a global pandemic. Markets, which had largely remained complacent up to this point, now seem infected as stocks have tumbled for 6 days straight.

While the future outcome of the virus is still unknown, in this piece we examine the impact that COVID-19 has had to date on credit markets and the best course of action we see for investors moving forward.

Read why investors may need to go beyond traditional fixed income sources to find income.

Download the report
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Quantifying COVID-19: Impact on U.S. CRE

We take a look at potential outcomes and how they could impact the CRE market.

COVID19_CRE_@2x_Email_600x600.jpgThe U.S. CRE market, just like every other corner of financial markets, will almost certainly be impacted by COVID-19. Ultimately, the severity of the impact will largely be determined by how quickly the virus can be contained in the U.S.

In this note we look at potential impacts of COVID-19 on the CRE market, how much stress properties are equipped to handle, and which property types are most exposed.

Which types of properties are most exposed?

Find out in our report
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Impact of oil market dynamics

Crude prices tumbled as a supply shock hit an oil market already pressured by COVID-19.

Investment-News_Research_@2x_Email_600x600.jpgCrude oil prices have plummeted, with a demand shock from the COVID-19 outbreak and a supply shock caused by the breakdown in OPEC+ talks driving an unprecedented move. WTI has fallen 49% from its level to start the year, including a spectacular 28% drop on March 7, the largest one-day decline since the Gulf War.1 While significant, economic and financial market exposure to the energy sector in the U.S. has fallen since the last oil downturn, helping to buffer potential impacts.

Learn more about the ramifications of the oil price plunge.

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New study: Reframing alternative investments

Advisors and their clients are searching for ways to navigate these uncertain times, especially as many investors are planning for, approaching or in retirement.

Investment-News_Research_@2x_Email_600x600.jpgAlternative investments may help – and our recent survey shows both advisors and individuals are interested in increasing their allocations to alternatives but desire more education and better conversations.

FS Investments conducted a study in partnership with InvestmentNews Research to gain deeper insight on advisor and investor goals and their knowledge of alternatives’ benefits, drawbacks and role in constructing diversified portfolios.

Learn why education may be the key to better investing outcomes.

Download the report
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1 Bloomberg Finance, L.P., as of March 12, 2020.

2 All views, opinions and positions expressed herein are that of the author and do not necessarily reflect the views, opinions or positions of FS Investments. All opinions are subject to change without notice, and you should always obtain current information and perform due diligence before participating in any investment. FS Investments does not provide legal or tax advice and the information herein should not be considered legal or tax advice. Tax laws and regulations are complex and subject to change, which can materially impact any investment result. FS Investments cannot guarantee that the information herein is accurate, complete, or timely. FS Investments makes no warranties with regard to such information or results obtained by its use, and disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information.



This information is educational in nature and does not constitute a financial promotion, investment advice or an inducement or incitement to participate in any product, offering or investment. FS Investments is not adopting, making a recommendation for or endorsing any investment strategy or particular security. All views, opinions and positions expressed herein are that of the author and do not necessarily reflect the views, opinions or positions of FS Investments. All opinions are subject to change without notice, and you should always obtain current information and perform due diligence before participating in any investment. FS Investments does not provide legal or tax advice and the information herein should not be considered legal or tax advice. Tax laws and regulations are complex and subject to change, which can materially impact any investment result. FS Investments cannot guarantee that the information herein is accurate, complete, or timely. FS Investments makes no warranties with regard to such information or results obtained by its use, and disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information.

Any projections, forecasts and estimates contained herein are based upon certain assumptions that the author considers reasonable. Projections are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying the projections will not materialize or will vary significantly from actual results. The inclusion of projections herein should not be regarded as a representation or guarantee regarding the reliability, accuracy or completeness of the information contained herein, and neither FS Investments nor the author are under any obligation to update or keep current such information.
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