COVID-19 stock plays are investment options that focus on areas impacted by the coronavirus pandemic. Some of them have a fairly obvious connection, such as services that say upticks in demand due to stay-at-home orders. Others may not stand out as clearly, but the relationship is still there. By focusing on some of the opportunities, you may be able to make some money with your investments. If you are wondering how you can make the most of COVID-19 stock plays, here’s what you need to know.
Understanding the COVID-19 Market Drivers
COVID-19 impacted the stock market in a number of ways. Stay-at-home orders had a two-fold effect. First, the pandemic led to widespread business closures, often due to state orders. In some cases, companies had to transition to work-from-home models. However, some didn’t have that option and, if they weren’t deemed essential, ultimately had to cease operations, at least for the interim.
Second, it caused demand for certain goods and services to increase dramatically, while others tumbled. This includes a broad selection of delivery and streaming services, as well as a variety of essential businesses, like grocers. Additionally, since COVID-19 represents a health-oriented crisis, certain pharmaceutical and vaccine-research organizations saw demand spikes.
Declines were common in sectors that required people to gather. For example, movie theaters were frequently shuttered in harder-hit states, malls were closed, and amusement parks shut down. However, they weren’t the only areas that saw declines.
Additionally, it’s important to note that COVID-19 led to a degree of volatility. Many investors became uncertain when it came to what the future may hold, a sentiment that remains in some sectors today. It’s an unprecedented time, and it isn’t clear what the “new normal” will look like, particularly as the pandemic may remain a concern for months, if not years, to come.
Identifying COVID-19 Stock Plays
If you want to take advantage of some COVID-19 stock plays, you have to identify companies that have room for growth in the current climate. That could include businesses that took a hit early in the pandemic but are on the road to recovery or those that are strengthened by the shift in demand.
While it is impossible to guarantee that any stock will increase in value, some are poised for growth. Technology, biotech, and healthcare are some sectors that may be primed for gains, as well as certain finance industry businesses.
COVID-19 Stock Plays to Consider
The COVID-19 situation is fluid, which could cause stock prices to fluctuate unexpectedly as things evolve. However, if you’re looking for COVID-19 stock plays, here are some to consider:
- UnitedHealth Group
- Bank of America
- AbbVie Inc.
- CVS Health Corporation
- Morgan Stanley
- Zoom Video
- Inovio Pharmaceuticals
- PPG Industries
- Gilead Sciences
- Regeneron Pharmaceuticals
Choosing the Right Stocks for Your Portfolio
As with all investments, choosing the right COVID-19 stock plays for you means examining your portfolio and doing additional research. The situation is ever-evolving, so today’s winners can easily turn into tomorrow’s losers.
Additionally, each stock represents a unique risk level and degree of potential. Your short- and long-term goals may dictate which options are best for your needs, as a short-term trader may be better served by stocks that won’t help a long-term, buy-and-hold investor as much.
However, those listed above are predominately worth exploring. Examine each stock’s history and current standing, and see if any of them are right for you.
Are you aware of any other COVID-19 stock plays that could help people make money? Share your thoughts in the comments below.
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