Black swan event

A rare event with unexpected consequences that are severe and widespread. Examples include the dotcom crash in 2000; the Global Financial Crisis of 2008 and the COVID-19 pandemic. It could also be a natural event such as a major catastrophe. Investors can help to protect their portfolios against black swan events by diversifying their portfolios and investing in funds managed by professional managers who are informed about financial markets. Such events could also be viewed as good buying opportunities because financial markets generally over-react initially to them, making assets cheaper, and invariably recover at some stage.