Coronavirus outbreak: To buy or to sell stocks?

May-25-2020Blog by – Mr. Dhruv AjmeraRead Time: 3 Min.Word Count: 762
259Coronavirus outbreak: To buy or to sell stocks?

As the COVID-19 outbreak’s collateral damage gets worse and worse, traders have started wondering if right now is the time to sell stocks. The coronavirus has had a continuously bad impact on the stock market. In the early days of the lockdown itself, we saw the stock market crash due to COVID-19. Now, while the situation looks bleak for an investor, this might have a few silver linings with it too. Let’s have a look at the details.

A bear market, by its definition is when the benchmark indices of a nation fall more than 20% of where they had reached. Our indices, Nifty and Sensex fell by more than 30% as a part of the global stock market crash due to COVID-19. This means we are definitely in a bear market.

As a stock advisory company in Mumbai, we can tell you that the saying in the investment world is that bear markets are for investing in stocks. But we understand how it might not sound like the best idea right now. The only ones who are still willing to buy stocks are the ones with skin in the game.

We believe that right now, even the ones who haven’t traded before in their lives, this poses a good opportunity to start trading more frequently and understand the nuances of investing in a bear market. With prices falling, it is practically like a sale in the stock market right now. Start with setting up a budget for yourself and once you have done that, you can get in touch with an online stock trading company.

Online stock trading companies are the future for traders: seasoned and amateur traders both. They can help one with their portfolio whilst keeping in mind their social distancing requirements too!

In addition to the stock market and how coronavirus effects have spread all over the global market, stock market advisors believe that the repercussions of COVID-19 on the stock market will last much longer than any of the previous global market crises to have existed. This means that one can’t wait too long for situations to get better, as everyone fears a consistent economic slowdown. 

With this fear, one has to make do with what they have. If the bear market continues, and you are willing to invest, you’ll have to start buying stocks rather than selling. With stocks at a much lower price, you can choose stocks from well-performing companies and start building your portfolio. A bear market, even with the coronavirus, will not last forever. When things do get better, you can sell those stocks at a much better and attractive price. Start building your portfolio by getting in touch with an online stock trading company, that will help you choose the right listed companies as per your budget.

While the graphs of the stock markets don’t look good with the coronavirus effects, there is one thing we certainly don’t recommend! We’ve shared the dos with you so far. Here is the big don’t: Do Not Exit The Stock Market In Panic. Panic is an emotion and emotions are best kept at bay when it comes to trading and investment.

One has to understand that investments are a long term thing. There will be lows, which can be as unpredictable as this one, and there will be really good highs too. Risk is a part of trading and all one can do is minimize the risk. Of course, we understand that this risk analysis is no child’s play, which is where your stock advisory company comes in.

Recovery for your losses will seem bleak, but one cannot exit when they are making losses in the market. Your advisors and financial experts all over the globe will always recommend that a bear market is the worst possible time to exit and make one’s portfolio seem unlike to what it should be.

If you are in such a situation, what you can do is take a halt, let it stay put. Or if you have accepted the low in the market, you can start investing in more companies with lesser stock prices right now, as the prices are attractive like never before! This is the time for aggressive buying, not selling.

We hope this blog brings you a certain amount of information and hope in the times of such negativity with coronavirus and its effects all around us. To get to know more about trading in the times of the pandemic, get in touch with us or call +91 22 4062 8990

Also Read: How can an Investor be Navigated during COVID-19

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