Protective Hypothetical Investment Portfolios during the COVID-19 Recession: Comparison with Superinvestors
Protective Hypothetical Investment Portfolios during the COVID-19 Recession: Comparison with Superinvestors
Author(s): Fedor Šimko, Peter PšenákSubject(s): National Economy, Business Economy / Management, Micro-Economics, Policy, planning, forecast and speculation, Financial Markets, Socio-Economic Research
Published by: SAV - Slovenská akadémia vied - Ekonomický ústav SAV a Prognostický ústav SAV
Keywords: Capital Asset Pricing Model; economic recession; resilient portfolio; Super-investors; diversification;
Summary/Abstract: By examining the portfolios of renowned Superinvestors with different investment strategies, BRK-B of Warren Buffett and ARKK of Cathie Wood, we aimed to design hypothetical resilient portfolios that protect against the damaging effects of recessions. The presented analysis indicates that ARKK significantly outperformed BRK-B during the stability period. However, in the face of the Covid-19 pandemic-induced recession, BRK-B displayed a higher degree of resilience and stability compared to ARKK. All three of our hypothetical portfolios delivered positive returns during both periods of stability and recession. Importantly, our Tangency Portfolio demonstrated the strongest performance of all the investigated portfolios during the recession. Moreover, our Tangency Portfolio showed relatively high performance along with high stability. It is concluded that an investment approach based solely on diversification, can achieve superior returns, and even surpass the broader stock market with an acceptable level of risk.
Journal: Ekonomický časopis
- Issue Year: 74/2026
- Issue No: 01-02
- Page Range: 26-47
- Page Count: 22
- Language: English
