Its been a month, that the market is crashing like a falling knife, with bloodshed all over the financial sector. It's scary to see your investment go down more than 40-50% in a matter of few weeks, and that's not without reason.
The rapid speed of coronavirus spread has actually spooked sentiments of investors across globe, and this is nothing short of a global crisis. Most of the stock market across globe, has fallen above 30% and Indian market is no immune. The crisis is real but do we have a way out?
Whenever I am in doubt about market, I ask history... Because the line "This time it's different" always get defeated by "This too shall pass". Look at the graph...
Its evident from the graph that stock markets can be really volatile during short term but in long term, it can be highly rewarding. The returns is 10 times after accounting all the market crashes over last 20 years.
Now coming to the topic of investing during market crash, it is clearly a favorable time to put money in stocks, but with a plan. If you randomly put money is stocks that are fallen most, you may not get it back for years. So what is the best way to put money now? In one word, stick with Market leaders and start putting money with a plan.
In the next post, We shall share some of the Market leaders of Indian stock market. You are advised to do your own study as well, so that you have greater confidence before investing.
Keep learning!