Following the recent market volatility, we looked at the performance of the stocks in the All Ordinaries during the 2020-21 market downturn to find what companies proved more resilient and might offer similar stability during the current volatility.
COVID saw the ASX All Ords index drop -37% in a month
The outbreak of COVID in Australia saw the ASX All Ordinaries peak on 20th February 2020, before a precipitous drop which bottomed on the 23rd March 2020 with the index down -37%. It took just over a year for the index to recover, regaining its previous high on the 14th April 2021, equating to a +60% increase from its low.
We examined the performance over this period of the 429 companies currently in the ASX All Ordinaries that were trading at the time to help identify companies that may again outperform the market through the current period of volatility.
For each company, we looked at both how far their share price fell and how much it rebounded once the index had bottomed. We classified each company according to its performance compared to the index:
Of the 429 companies in the group, 83 (19%) were superheroes, with the majority (253) being balls. Figure 1 below shows the distribution of the companies, with surprisingly few eggs (21).
While different factors are at play causing the current volatility compared to COVID, there are certain factors that provided resilience during COVID that will be similarly beneficial over the coming period.
Table 3 below lists the 40 largest “superheroes” by current market cap. Please email me if you would like the entire list of companies.
