U.S.-Iran tensions will spark increased volatility — here’s how to play stocks, fund manager says

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The end of 2019 might have momentarily eased global risks and fears -- but all that has changed a few days into the new year.

The end of 2019 may have momentarily brought an easing of a number of global risks and fears, but that has all changed a few days into the new year. The U.S. killing of top Iranian general Qassem Soleimani has ramped up tensions between the two nations, sending stocks into reverse and oil prices soaring. But what will happen next and will that trend continue?

“So, on a short-term basis, the stock indexes have had a nice uptrend since October, with low volatility, so we shouldn’t be surprised to see it reverse to a short-term downtrend and a volatility expansion.Shell added that it was impossible to predict what would happen next in Iran, but that investors should instead focus on directional price trends and trust systems and process.

He said it was time for investors to call upon predetermined exit points to cut losses short and weigh up portfolio risk with a predefined drawdown limit in mind.After falling 233 points on Friday, the Dow Jones Industrial Average DJIA, -0.22% opened lower on Monday, falling 0.4% in early trading. The S&P 500 SPX, -0.06% and Nasdaq Composite COMP, +0.10% also edged lower as tensions remained high following the U.S. airstrikes that killed Soleimani. European stocks SXXP, -0.

Japan’s justice minister has promised to strengthen border checks and review bail conditions after former Nissan 7201, -1.67% chairman Carlos Ghosn escaped the country and fled to Lebanon. Ghosn was awaiting trial on financial misconduct charges.

 

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