The bears have tightened their grip on Dalal Street and wiped out more than Rs 29 lakh crore worth of investors’ wealth since early February. The Russian attack on Ukraine is becoming increasingly serious not only for Moscow but also for global development, with the growing possibility that the US and its European allies will impose sanctions on Russian oil and natural gas without harming global supplies. can. The news has pushed crude oil prices to a 13-year high, a major cause for concern for emerging markets like India, which still imports more than 80 percent of its oil requirement and sends him into a state of panic.
However, for those who have been in Share Market With less than two years to go, the huge one-sided fall in prices over the past seven sessions would be shocking. The unfortunate truth is that investors put money in stocks during a bull market – shares It’s been on the rise for a while and the news is hyped, like nothing can go wrong with the markets. For fear of missing out, some small individual investors pile on. The panic and bailout of the same followed by the slightest sign of improvement.
don’t sell in panic
During a market correction, selling your investment may seem like a good idea. Negative news such as a pandemic, an asset bubble that is about to burst, scams exposed, etc. can affect any investor.
However, market experts say that the best and worst performing days of the stock market are often very close to each other. This is the main reason why the strategy of timing the market does not work well for most regular investors. The important thing to remember is that fear leads to panic, especially among amateur investors. This panic often forces the investor to sell their investments at lower prices during a stock market crash.
Buying Dips Isn’t Always Wise
Similar to panic selling during a market crash, it is also important that you do not panic buy during a market crash. Panic buying can be described as a state of mind that leads you to invest indiscriminately, which can hinder reaching your current investment goals.
After all, when markets are down, it’s often the best time to invest at a fair valuation. In such cases, investors often invest in bluechip stocks or buy index funds.
However, many investors in such cases tend to forget a key aspect of equity investing – their risk appetite. The buying frenzy when the market tanks can prompt investors to invest in equities beyond their actual risk appetite.
Currently the market is in a bearish zone. VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said: “Investors have to be cautious. There is relative safety in energy due to higher energy prices, metals due to higher global prices, and export segments due to resilient demand and depreciation of rupee.
A very small quantity of calibrated purchases may be considered in the above mentioned segments.”
add no fresh stock
Do not add any new stocks to your portfolio at this time as they look cheap. Remember, stocks that have fallen 50 percent from their peak can still be expensive if their financials aren’t good.
Do not invest in sector-specific stocks
During a stock market crash, portfolio diversification is essential. Yes, some stocks can sink forever at some point, but a careful investor won’t have them, or they will have amounts no matter what. However, since new investors may not have enough experience of ‘what to do’ during a crash, they should seek help. Nishit Master, Portfolio Manager, Axis Securities, said: “First time investors should work with professional advisors and invest in good quality companies which are available in installments at reasonable valuations. They should also avoid leverage.
Do not turn your back on the equity market completely
The bicycle is an integral part of the market. It is when you see both a bull and a bear market that you are on your way to finally becoming a wise investor.
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