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Coronavirus Outbreak: “If it is not the best time to invest…then when?”

The stock market has experienced many wild rides over the past century. Indian stock market has its share of wild rides throughout history. People still never forgot the financial crisis of 2008 when the Indian stock market went through a wild downturn, but this coronavirus pandemic has caused the biggest market drops in the history of stock market which we will never forget. The major indices of the Indian stock market dropped more than 30 per cent meanwhile the Wall Street’s benchmark indices lost more than 20 per cent. Investors couldn’t recover from the fall of Yes Bank and then the coronavirus took control of the market sentiment leaving everyone off-guard. As a result, the panic selling started in the market where the Foreign Portfolio Investors withdrew more than Rs. 60,000 crore from equities meanwhile the retail investors pulled everything out of the market after incurring significant losses.

Everybody remembered the Nifty50 index’s lifetime high of 12,430 from January. It was a peak time when everyone was turning towards the equity market seeing the potential returns. But, the coronavirus that once initiated from Wuhan, China spread all over the globe in a few months leaving the global economy in a turmoil.

Is it the Right Time to Invest in the Market?

It goes without saying, it is the ‘recession’ time that we all must face. Amid coronavirus, we witnessed the high fluctuations in the stock market that made us wonder whether it would be right to put your money in this market or not. After all, no one knows where the economy will turn in the wake of COVID-19 without any cure developed to counter it? Amidst all this, the stock experts are suggesting to capitalize on the opportunity at hands to make the best possible returns in the future. There is a saying, Buy on Cannons and Sell on Trumpets – meaning, one should buy at the times of war as the prices are low and sell at the times of victory because the value is high at that time.

If that’s is true then why many people are still hesitating to invest?

So, the question still stands, if it is not the right time to invest in then when?

Are they fearful of losing again?

Well, we can’t argue especially when there is a good chance that the country no, the whole economy can fall into a deep recession which would take years. No doubt, the current mayhem is a double whammy. The investors not only had lost money in this market but faith as well.

But, there are two things we mustn’t forget. First, the stock market is always volatile. Even before the coronavirus, the Indian economy was moving towards the slowdown. So, what’s making it so special? And second, whatever the crisis is, the market always recovers. It is just a matter of time.

However, it may take months or years. But, if your goal is investing for a long-term period then it is the high-time. Make long-term investments for your future financial goals. It is the opportunity to capitalize on the discounted prices of quality stocks which are trading at low due to the pandemic. But, that won’t stay for long. Once the market recovers and a rally will come in the stock market and restore the market to its initial position.

The stocks of many big companies are trading at their lowest. That means you can have them at a good bargain. The only difference in investing now than later is, if you invest now you will not only witness the rally but also be the first to make profits out of it. By the time, you decide to sell your securities you will experience significant gains during that time. So, undoubtedly, it is the prime time to do stock investing. But, if you are at tight money spot then we would suggest you to not put your life-long savings into the stock market. There is no exact prediction of whether the market hits the bottom or not. If things go south, you may end required short-term emergency funds which no longer available in future if you put everything in the market.

So, make smart decisions to capitalize on the opportunity while looking for long-term.

 

 

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