Stock market is just like our life, it has its own highs and lows over a period of time depending upon various circumstances. In my past 21 years of professional experience I have been observing multiple market cycles of bullish & bearish phases. People generally tend to get panic in situations where markets are going down and become over enthusiastic when markets are making newer & newer highs.
The message that I convey to Investors in tough times is “During Bear market, if you redeem (exit), you convert temporary loss into permanent loss. Whereas if you invest, you convert temporary opportunity into permanent wealth.”
Choice is yours.. !
Stock market is the only place where people run out of the store when things are on sale!!
I believe for an Investor their life’s biggest mistake is to exit in such market falls when you can get maximum returns, also when markets are high people always tend to invest more which is generally not much fruitful in terms of returns.
Generally, when the shares of a company for which one desires to invest into is available at Rs.100 in the bullish phase you tend to buy it but when the same is available at 30-40% lower during turbulent times people think to exit during such falls out of emotion, instead according to my views its the best time to invest as probability of making money is much higher when one invests at lower levels.
Let me share with you how to manage this stock market volatility/fall…
1. If you have fully invested, stay calm. Write every day “Invested for long term” to focus on your Goals.
2. If you have money to invest, be happy and start investing. Now is the right time!!
3. If you are a SIP investor, be more happy. More the time markets stay lower, more you are being benefited.
Not being self obsessed but I would like to share with you all that in this current market fall where the investor’s portfolio have fallen drastically, Mehta Fincon has not received a single redemption. In fact when you have a trusted advisor who can handhold you during tough times you feel secured and the outcome would be positive indeed.
Now let’s have a look at 3 Year Returns After Every Major Fall In Sensex.
In the below table I have covered all the major falls of last 18 years.
Every Correction In Stock Market Is An Opportunity To Buy
What we understand from this study is if one would have invested during tough times, then next 3 year returns would have been anywhere between 33% to 316%.
So avoid the noise, don’t panic, invest wisely and make the best out of these current market fall to create wealth.