"A U.S.-Iran war could even be a tailwind for stocks"

Source

Korea Economic Daily

Summary

Steve Eisman said that regarding a U.S.-Iran war, there is no need to overreact to short-term shocks and that it could be positive for markets over the long run.
Eisman said he would not change his existing investment strategy at all despite the conflict, adding that asset prices could return to previous levels in two months.
Barclays and other studies said they have confirmed a tendency for the S&P 500 index and stock prices to recover in the short term after major geopolitical events.

Forecast Trend Report by Period

Eisman: "I won’t change my investment strategy"

Investor Steve Eisman, known for the film 'The Big Short,' argued that in connection with a U.S.-Iran war, investors need not overreact to short-term shocks and that it could be positive for markets over the long run.

On the 2nd (local time), when asked on CNBC whether he would change his investment strategy because of the conflict, Eisman said, "I won’t change a single trade." He added, "I think it’s very positive in the long term," saying, "People are reacting to the current situation and oil prices have clearly risen, but if things unfold smoothly, asset prices will return to their previous levels in two months."

U.S. stocks saw significant volatility that day, but there was also analysis that historically geopolitical clashes have had little long-term impact on equity markets. According to Barclays’ trading desk, the day after major geopolitical events since 1980, the S&P 500 index has shown virtually no change on average. Other studies likewise found a tendency for stock prices to recover within a month after the outbreak of global conflicts.

New York = Correspondent Park Shin-young nyusos@hankyung.com