In the 1990s, news agencies had guidelines for reporting share price movements. A fall of 0.2% corresponded to the category "just about maintained", a discount of 1% was categorised as translated into "lower" or "weaker". If share prices fell by more than 4%, terms such as "price collapse" or "sell-off" were recommended. The manual used at the time no longer works today. After all, if a share price already "plummets" at minus 4 %, how are you supposed to explain how to describe a daily loss of 10% or even 25%? As a "historically unprecedented crash"? No, because double-digit price losses of individual stocks are no longer so unprecedented and historic.

In mid-November, Bayer's shares fell by more than 18% in just one trading day after an essential promising drug in the pipeline proved less effective than the comparator drug. Fresenius Medical Care also fell by 18% within one trading day at the beginning of October. Here, too, a pharmaceutical study was the decisive factor, although in this case, it was the positive interim result for the drug from competitor Novo Nordisk. Shares in the biotech company Morphosys fell by as much as 21% because investors were disappointed that a drug did not show a statistically significant benefit in a study for a secondary objective. Curiously, after details became known, the share price jumped by 34% again three weeks later.

One might assume that only pharmaceutical companies suffer severe daily losses. But that is not the case. In June, Siemens Energy's admission of quality problems at its wind power subsidiary Gamesa cost 37% of its stock market value within a few hours. In November, the shares of drinks giant Diageo plummeted by 13% simply because the Johnnie Walker company had previously announced a drop in sales for its business in Latin America, a peripheral market for Diageo by the way.

These examples lead to the conclusion that investment behaviour on the stock markets is currently characterised by nervousness – and by the pattern of quickly pulling out of individual stocks if there is any suspicion that something is going wrong. One reason why many portfolios are now being managed according to the "Spitz pass auf" principle – a game in which you withdraw your own position at lightning speed – is probably the changed risk profile. This is because in times of great uncertainty, the reflex to quickly remove from exposures where risks that are difficult to assess emerge is even more pronounced.

And there is currently no shortage of uncertainties. Investors have long had to pay attention not only to economic risks or risks associated with a company's specific business model. In fact, they have to consider geopolitical risks much more than before – for example, the foreseeable effects of an escalation between China and Taiwan on the revenues and earnings of the companies in which they are invested. In addition, reputational risks – from inadequate environmental protection to critical social conditions – play a much more significant role. Operational risks have also taken on a new dimension since cyber-attacks can paralyse business processes for days. Last but not least, the overriding question is whether the companies in the portfolio will succeed in measurably and continuously reducing their emissions to avoid becoming a “stranded asset”.

So far, the business models of most companies have proven to be surprisingly resilient – despite wars, pandemics, energy price shocks and sudden interest rate reversals. In just a few days, equity investors worldwide will be able to celebrate a pleasing stock market year. In this respect, it would, of course, have been a big mistake to withdraw from the stock market in 2023. However, investors are now faced with risks of a new dimension that are, firstly, considerable and, secondly, can materialise at extremely short notice, virtually from now to right now. It is, therefore, to be expected that extreme flight movements from individual stocks will continue to be observed in 2024.