A Capitalist Pig View on Swine Flu

April 28, 2009 at 11:19 pm Leave a comment

I just could not resist posting such a title!

The fact that markets more or less ignored swine flu news is encouraging.  When equities stop declining in the face of obviously bad news, it is often a sign that there are few sellers left.

There are, however, certain sectors that have suffered as a result of this outbreak, most notably Mexican airport operators, such as Grupo Aeroportuario del Pacifico (PAC), Grupo Aeroportuario del Centro Norte (OMAB) and Grupo Aeroportuario del Sureste (ASR).  These stocks already suffered from loss of traffic due to economic situation, as well as fears from continuing Mexican drug wars.  And now this.  But it is exactly situations like these that can present good long-term opportunities.

Remember the fears around the brid flu a few years ago which did not amount to much? Of course, no one can predict how many people will be affected by the swine flu.  Still, it pays to not feel like a chicken and instead to take advantage of market inefficiencies like a capitalist pig should!

Entry filed under: Market Conditions.

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Blog Author

Leon Shirman's long-term investment philosophy is summarized in his book, “42 Rules for Sensible Investing”, also available from Amazon.


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