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Coronavirus (COVID-19): Stocks to buy and how to invest

Investment ideas and strategies to navigate a market crash

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The coronavirus pandemic has had an extraordinary impact on global stock markets. Since late February, benchmark stock indices in Australia, the US and the UK have fallen by around 30% amid unprecedented volatility.

With countries closing borders in response to the growing threat and oil price disputes among the world's biggest producers sending prices plummeting, some analysts predict we're in the midst of an unfolding global recession.

While shareholders have been hit by heavy losses, many will be using the market crash to keep an eye out for new buying opportunities or even profiting from falling prices. Regardless of your approach, it's a good time to review your portfolio and consider your next steps. We've compiled a list of investing guides and stock ideas to help you navigate this turbulent time.

If you're looking for other coronavirus-related guides, you can head to our coronavirus hub page or the World Health Organization (WHO) for further advice. If in doubt, speak to a professional.

Source: TradingView, Updated daily at 4.30pm AEST

Which stocks might drop?

Important: No one can say for certain which direction stocks will go – there's plenty of speculation about where the global economy might be headed. Below are some of the more common ideas among analysts about how stocks could be affected.

When there's a global event like this, most stocks will react negatively. That means many of the major blue chip stocks, such as the major banks, Telstra and CSL, are also likely to fall, offering a potential buying opportunity at discount prices.

Because of the nature of the pandemic, tourism stocks are expected to be among the hardest hit as travel restrictions are put in place to curb the spread of the virus. This includes airlines, hotels and tour companies.

With major cities in China locked down, some analysts predict Chinese demand for imported goods could lessen as its economy slows. This means Australian companies with large Chinese exposure could see profits down this year, and investors will be pricing in that possibility.

Mining and energy companies in Australia have a strong reliance on global demand and the oil price. If the pandemic does spark a global recession, Australia's major energy companies are expected to take a hit.

No one can say how long these stocks will stay down for; however, a steep drop in prices is a good opportunity for bargain hunters willing to wait out the correction.

Travel and tourism

  • Virgin Australia (ASX:VAH)
  • Qantas (ASX:QAN)
  • Sydney Airport (ASX:SYD)
  • Auckland International Airport (ASX:AIA)
  • Webjet (ASX:WEB)

Blue chip stocks

  • Commonwealth Bank of Australia (ASX: CBA)
  • Australia and New Zealand Banking Group (ASX: ANZ)
  • National Australia Bank (ASX: NAB)
  • Westpac (ASX: WBC)
  • Telstra (ASX: TLS)

Chinese demand

  • Treasury Wine Estates (ASX:TWE)
  • Crown Group (ASX:CWN)
  • Star Entertainment Group (ASX:SGR)
  • BlueScope Steel Limited (ASX:BSL)

Energy companies

  • BHP Group (ASX:BHP)
  • Fortescue Metals Group (ASX:FMG)
  • Woodside Petroleum (ASX:WPL)
  • Oil Search (ASX:OSH)

Which stocks could benefit?

A global crisis typically results in safe-haven investing, which means bonds and gold. This tends to send the gold price soaring while bond yields drop as demand goes up. Read our full guides on gold and bond investing for more information.

This often (although not always) results in gold company stocks becoming more popular. That being said, gold stocks are influenced by many other factors including global demand and new discoveries so it's also possible for stocks to go backwards.

A pandemic also benefits a few specific sectors, such as healthcare, insurance and protective gear manufacturers, such as face-mask suppliers. Meanwhile, companies that support working or studying from home should also react positively as people are forced to isolate themselves.

Many of the biggest beneficiaries might be established US companies such as Zoom (NASDAQ: ZM), Slack (NYSE: WORK) and GSX Techedu (NYSE: GSX).

Gold companies

  • Saracen Mineral (ASX: SAR)
  • Regis Resources (ASX: RRL)
  • Newcrest Mining (ASX: NCM)
  • Resolute Mining (ASX: RSG)

Healthcare

  • Biotron (ASX: BIT)
  • ResMed (ASX: RMD)
  • Fisher & Paykel (ASX: FPH)
  • Co-Diagnostics (NASDAQ:CODX)

Protective wear/wash

  • Zoono Group (ASX: ZNO)
  • Alpha Pro Tech (NYSEMKT:APT)

Working/studying from home

  • Idp Education Ltd (ASX: IDP)
  • Zoom (NASDAQ: ZM)
  • Slack (NYSE: WORK)
  • GSX Techedu (NYSE: GSX)

How to invest when there's a market crash

When markets crash, it can be tempting to sell your shares in an attempt to avoid further losses. But this is not necessarily the best strategy, especially if you hesitate on pulling the trigger.

Stock market downturns are a reality, and must be considered alongside the record gains of recent years. It's often a better idea to ride out the volatility rather than try to time the market, according to Shane Oliver, chief economist at Australian financial services giant AMP.

A lot of people get tempted to sell, then suddenly the markets find a bottom. Before you know it, they're back above the levels where a lot of people sold.”

Shane Oliver, AMP's chief economist

Know your strategy

Your best course of action in the event of a crash will depend on your trading strategy and overall investment goals, according to Michael McCarthy, chief market strategist for share-trading platform CMC Markets, who spoke to Finder. "In most cases, investors should be reviewing closely and working out what a 10% drop or a 20% drop would mean to their holding. Whereas somebody who's taking a more active approach might start weeding their portfolio."

It's important to know what your goals are and whether a crash has impacted your ability to achieve those goals. It is possible that a crash gives you some good reasons to sell.

Be prepared to buy the dip

When markets dip, you can make money. The key thing is to be ready for this to happen and to have the funds to snap up shares when the prices are low.

Timing the market is incredibly hard and you're very unlikely to get the stock at its absolute lowest, but as with all investments, if your intention is to hold for the long term, it can be a good opportunity to snap it up at a lower cost.

One way to prepare if you're an active investor is to keep a list of stocks that you would be willing to buy if a crash happens.

Seek financial advice

When stocks are crashing it is easy to get swept up by your emotions. If 20% of your portfolio value has been knocked off, you might not be in the right frame of mind to be making decisions which could impact your financial future.

Seeking a second opinion, ideally from a financial adviser, can give you some perspective to your thinking and guard against any rash decisions.

What happens after a crash?

Following a market crash, stocks are likely to experience a period of volatility as investors reevaluate the market. But downturns can also represent investment opportunities, especially if there are certain stocks you think may have switched from overvalued to undervalued.

Cautious investors may often flock to "safe haven" investments like gold, bonds or even bitcoin, so a market downturn may be a good time to think about diversifying your investment portfolio.

If history is any indicator, the markets should eventually rebound, but trying to determine when this will happen is the million-dollar question. Stocks may recover within weeks or months, or we may be faced with a years-long bear market, especially if global recession fears turn out to be on the money.

How to profit from a falling market

It's possible for traders to profit when prices are falling through a strategy called "shorting the market". Because this is typically a risky strategy, only experienced traders are advised to do this.

The most common ways that people can profit from falling equity, currency or commodity prices is through CFD, Forex or options trading. You can check out our guides on those below:

Compare trading platforms

Updated March 29th, 2020
Name Product Standard brokerage fee for ASX shares Standard brokerage for US shares Inactivity fee Currency conversion fee Markets
IG Share Trading
AUD 8 or
0.1%
USD 10 or
2 cents per share
$50 per quarter if you make fewer than three trades in that period.
0.50%
ASX shares
Global shares
Forex
CFDs
Margin trading
Special offer: Earn up to 10,000 Qantas Points when you start trading on a new IG Share Trading account. T&C applies.
Enjoy some of the lowest brokerage fees on the market when trading Australian shares, international shares, forex and CFDs, plus get access to 24-hour customer support.
Bell Direct Share Trading (Silver account)
AUD 15 or
0.1% for first 10 trades monthly
N/A
$0
N/A
ASX shares
mFunds
Invest in Australian shares, options and managed funds from the one account with no inactivity fee.
Bell Direct offers a one-second placement guarantee on market-to-limit ASX orders or your trade is free, plus enjoy extensive free research reports from top financial experts.
CMC Markets Stockbroking (Classic account)
AUD 11 or
0.1% for first 10 trades monthly
USD 19.95 for
up to $5000 shares
$15 per month if you make no trades in that period.
Up to 0.60%
ASX shares
Global shares
Forex
CFDs
Margin trading
Options trading
mFunds
Access a broad range of investment products from Australia and overseas.
Take advantage of IPOs and trade shares, warrants, options and CFDs listed across the ASX, SSX and Chi-X, and other major global exchanges, including US, Canada and UK markets.

Compare up to 4 providers

Updated March 29th, 2020
Name Product Minimum Opening Deposit Minimum Opening Deposit Commission - ASX 200 Shares Available markets Platforms
Plus500 CFD
AUD 100
100
No commission
ASX shares, global shares, indices, options, ETFs
Plus500 Web Trader
CFDs are complex financial products and traders are at high-risk of losing all of or more than their initial investment.
Finder exclusive offer: Open a new trading account and receive a welcome bonus of AU$110 when you deposit your first $370 and enter the bonus code “Special200”. T&C’s apply.
Trade Australian and international CFDs on shares, forex, indices, commodities and more.
eToro CFD
USD 50
50
No commission
ASX shares, global shares, indices, cryptocurrencies, commodities, ETFs
eToro Trading Platform
CFDs are complex financial products and traders are at high-risk of losing all of or more than their initial investment.
Join the largest social trading network in the world.
AxiTrader CFD
USD 0
0
$0 for standard account, USD$7 per round trip for Pro account
Forex pairs, Metals, Commodities, Index CFDs
MetaTrader4, MetaTrader4 Next Gen, Psyquation, AutoChartist, WebTrader, Axi-One ECN
CFDs are complex financial products and traders are at high-risk of losing all of or more than their initial investment.
AxiTrader uses the popular MT4 trading platform along with several free add-ons. Live chat, email and phone support available 24 hours a day, Monday to Friday.
Important: AxiTrader is undergoing a review by the Administrative Appeals Tribunal into a recent decision by ASIC to suspend its Australian financial services (AFS) licence. Until a final decision has been made by the Tribunal, AxiCorp can continue normal operations. 
IG Markets CFD
AUD 0
0
0.08% with $7 minimum
Indices, FX, Shares, Commodities, Cryptocurrency, ETPs
MetaTrader 4
ProReal Time
CFDs are complex financial products and traders are at high-risk of losing all of or more than their initial investment.
Introductory offer: Build confidence by trading at lower minimum trade sizes for the first six weeks. Plus, receive a reduced commission on Australian shares CFDs. T&C's apply. Trade from over 15,000 markets with Australia's leading service for CFD trading and forex.
ThinkMarkets CFD
$0
$0
From $7 or 0.08%. (whichever is higher)
Forex, indices, commodities, metals, share CFDs, ETF CFDs, futures
MetaTrader4, MetaTrader5, ThinkTrader
CFDs are complex financial products and traders are at high-risk of losing all of or more than their initial investment.
Trade forex, commodities and CFDs using MetaTrader4/MetaTrader5 platforms or access advanced analysis tools through ThinkTrader.
City Index CFD
AUD 0
0
0.08% with $5 minimum
ASX shares, 4,500 global shares, indices
MetaTrader 4
At Pro
Advantage Web
CFDs are complex financial products and traders are at high-risk of losing all of or more than their initial investment.
Trade CFDs on indices, FX, global & Australian shares and commodities, plus access other markets such as metals, bonds and interest rates.
Pepperstone CFD
USD 200
200
No commission
ASX shares, global shares, indices, cryptocurrencies, commodities
MetaTrader 4
MetaTrader 5
cTrader
CFDs are complex financial products and traders are at high-risk of losing all of or more than their initial investment.
Trade stock indices on the global market, via Pepperstone's MetaTrader 4 and cTrader client terminals.
FP Markets CFD (Professional Account)
AUD 1,000
1,000
0.10% with $10 minimum
ASX shares, 6 global exchanges, indices, cryptocurrency
IRESS
CFDs are complex financial products and traders are at high-risk of losing all of or more than their initial investment.
Trade CFDs with FP Markets using the IRESSTrader platform. Trade CFDs on international equities, futures and forex.

Compare up to 4 providers

Disclaimer: Trading in financial instruments carries various risks, and you can lose more than your capital. This article may contain general advice. You should always seek professional advice when deciding if a product is right for you.
Updated March 29th, 2020
Name Product Monthly fee Options trading fee Standard brokerage fee for ASX shares
CMC Markets Options Trading
$0
$33 up to $10,000, 0.33% above $10,000
$11 or 0.1% for first 10 trades (for trade value up to $11,000)
CommSec Options Trading
$0
$34.95 up to $10,000, 0.35% above $10,000
From $10

Compare up to 4 providers

Updated March 29th, 2020
Name Product Minimum Opening Deposit Minimum Spreads for Major Currencies Commission Minimum Trade Size Platforms
Plus500 Forex Trading
AUD 100
0.7 - 3.0 pips
$0
0.01 lots
Plus500 Web Trader
Margin FX is a complex financial product and traders are at high-risk of losing all of or more than their initial investment.
Finder exclusive offer: Open a new trading account and receive a welcome bonus of AU$110 when you deposit your first $370 and enter the bonus code “Special200”. T&C’s apply.
Open an account and experience Plus500's easy-to-use proprietary trading platform, 24/7 online chat support and free real-time forex quotes.
eToro Forex Trading
USD 50
3.0 pips
$0
US$200 (to CopyTrade)
eToro Trading Platform
Margin FX is a complex financial product and traders are at high-risk of losing all of or more than their initial investment.
Social trading, advanced charting tools, plus receive exclusive benefits through the eToro Club (membership is tiered based on the equity in your trading account).
AxiTrader Forex
USD 0
From 0.0pip
$0 for standard account, USD$7 per round trip for Pro account
0.01 lot
MetaTrader4, MetaTrader4 Next Gen, Psyquation, AutoChartist, WebTrader, Axi-One ECN
Margin FX is a complex financial product and traders are at high-risk of losing all of or more than their initial investment.
AxiTrader uses the popular MT4 trading platform along with several free add-ons. Live chat, email and phone support available 24 hours a day, Monday to Friday.
Important: AxiTrader is undergoing a review by the Administrative Appeals Tribunal into a recent decision by ASIC to suspend its Australian financial services (AFS) licence. Until a final decision has been made by the Tribunal, AxiCorp can continue normal operations. 
IG Forex Trading
AUD 0
0.6 - 1.5 pips
$0
1 lot
MetaTrader 4
ProReal Time
Margin FX is a complex financial product and traders are at high-risk of losing all of or more than their initial investment.
Introductory offer: For the first two weeks of trading, take advantage of IG's lower minimum trade sizes to help you build confidence.
Choice of trading platforms. Choose optional extras like advanced charting, reporting and order types. Over 90 currency pairs to choose from.
ThinkMarkets Forex Trading
No minimum for standard account, $500 for pro account
From 0 pips
$7 per trade
0.01
MetaTrader4, MetaTrader5, ThinkTrader
Margin FX is a complex financial product and traders are at high-risk of losing all of or more than their initial investment.
Trade forex, commodities and CFDs using MetaTrader4/MetaTrader5 platforms or access advanced analysis tools through ThinkTrader.
City Index Forex Trading
AUD 0
0.5 - 1.22 pips
$0
0.01 lots
MetaTrader 4
At Pro
Advantage Web
Margin FX is a complex financial product and traders are at high-risk of losing all of or more than their initial investment.
Choice of trading platforms, integrated Reuters news and device-synching so you can monitor trades across multiple devices.
IC Markets Forex Trading (Raw Spread account)
USD 200
From 0.0-0.1 pips
AU$3.50 per 100k traded
0.01 lots
MetaTrader 4
MetaTrader 5
cTrader
Margin FX is a complex financial product and traders are at high-risk of losing all of or more than their initial investment.
Pepperstone Forex Trading (Razor Account)
USD 200
0.0 - 0.1 pips
AU$3.50 per 100k traded
0.01 lots
MetaTrader 4
MetaTrader 5
cTrader
Margin FX is a complex financial product and traders are at high-risk of losing all of or more than their initial investment.
Choose from a range of fee-free funding methods, plus a suite of 10 different apps available as part of Pepperstone's Smarter Trading Tools.
FP Markets (Standard Account)
AUD 200
0.1 - 1.1 pips
$0
0.01 lots
MetaTrader 4
MetaTrader 5
Margin FX is a complex financial product and traders are at high-risk of losing all of or more than their initial investment.
Low minimum opening deposit, real-time news and pricing, and customisable alerts based on news or technical trading indicators.

Compare up to 4 providers

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Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, options or any specific provider, service or offering. It should not be relied upon as advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involve substantial risk of loss and therefore are not appropriate for all investors. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades.

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