By , Wietse Nijenhuis, Client Portfolio Manager, Citi Investment Management, and Zeshan Azam, Head of Systematic Equities, Citi Investment Management
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COVID-19 has massively disrupted share buyback activity. We consider what this may mean for equity prices.
With companies receiving federal aid barred from repurchases for the next 12-plus months and others conserving their cash as the pandemic unfolds, corporations have lost their go-to share price strategy. To get a sense of the scale of that, S&P 500 Index companies alone have spent $1.6 trillion on buybacks in the past two years.
With this end to the low volatility era Wietse Nijenhuis, Client Portfolio Manager, and Zeshan Azam, Head of Systematic Equities, anticipate a vastly altered markets landscape, with newly exacting investor scrutiny around the formerly Biggest Buybackers, changes in market structure, revision of security selection criteria and, perhaps, the launch of a new era for ESG investing. To read their Mother of All Blackout Periods report, click here.