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32Stock market crash: Is it a good time to invest?Apr-21-2020

Stock market crash: Is it a good time to invest?

Blog by – Mr. Dhruv Ajmera
As we witness the rise of the deadly coronavirus and its effects in our daily lives, we also are encountering history in the making. The global stock market has been crashing and it is making everyone wonder if right now is a good time to invest in stocks. Being an online stock trading company, we can be of help! For now, let’s get to the pointers. Of course, the first thing is that it all depends on when the returns of the investment are needed and whether the nature of the investment is long-term or short-term.

Let’s face the truth before we discuss all the other pointers. These are mere answers to questions being asked frequently around this time. No, right now is not the right time to exit the stock market entirely. Yes, it is likely for the markets to drop down further and the stock market will remain volatile as a part of coronavirus effects.

Will stocks continue to build wealth?

Long-term wealth building continues throughout a lifetime, so a momentary dip like the coronavirus should not affect the long term picture. Of course, different points in time yield different returns. Some are better than the other. It is upon one to decide their high-points looking at the stock market patterns.

The other part of this is the fact that the more one invests in the stock market, the more likely they are to get long-time wealth. Stock market crashes, like this one will also affect them more. But in situations like these, one can pause investing further. It doesn’t mean that they should backout all together. Definitely not for a short-term issue like this, they will be able to get good returns in the near future. All one needs to ensure is a diversified portfolio and what we speak about in the next paragraph.

The want to stock-up on cash in the bank gets higher with panic around stock market crashes. But look at the silver lining here. It means that the stocks of a lot of listed companies are now available on sale. When the prices decline for an otherwise well performing stock, the good idea is to buy them at a cheaper price right now! That way, in the near future when things have settled in, you will get better than average returns for these stocks.

Start investing in the coronavirus lull

This is for all the beginners, the ones who haven’t started investing yet. The starting point can simply be setting up an automatic system from your salary each month. If that seems like something you do not prefer, you can decide upon an online stock trading company, discuss your budget and start investing in a diversified bunch of stocks. That way, a big chunk of your money is being divided into smaller amounts so that you can notice how each one of these stocks perform and then continue the next round of investments accordingly.

Let’s take the example of Warren Buffet, who is one of the richest men in the world. Investing and buying during the tough days, when nobody else was investing, and rather exiting, has proven to be fruitful for him. To quote Mr. Buffet, “Be fearful when others are greedy and greedy when others are fearful.”

A lot of investors make their money when the stock markets are crashing or are in the bear market. It has been historically proven to us that when a bear market ends, it is followed by an unusually bull market.

So, all the doubts and queries you have are quite valid. All the more, since the panic is widespread and affects all of us alike, strong-headed or not. This blog article can be a starting point for some calmness amid the storm of coronavirus effects. In case you want further guidance with your portfolio, or with an investment strategy or a budget allocation, you can reach out to an online stock trading company.

Opting for an online stock trading company will also take care of all your social distancing needs, when the lockdown gets over that is. Make a wise choice now, start investing today, so that if and when a crisis hits next, you have these savings as well!


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Divesh Shirsat

Nice Article

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