Friday, 6 March 2020

Corona Virus- An opportunity to Invest

  • Image result for carona virus hits world stock markets

  • Corona Virus has hit the stock markets like a global epidemic in finance
Investors  are in panic mode and as usual want to exit . Doing  the same mistake over and over again 

Many pessimist are trying to compare the same with 2008 crises where markets corrected by around 70%. Although we have corrected by 10% in this corona virus, this is being overplayed by pessimists

Conveniently ignoring good Service Sector PMI at 6 year high or High GST collections, IBC resolutions like Essar and Ruchi Soya are excellent for banks. Brent at 50 is like biggest boon to us And This is just the start

Corporate tax cuts will start to show the results now. 

However let us presume that the crises are as big as 2008( which is 100% untrue as per me and many analysts) Indian stock markets  played as under 

on 21 Jan 2008, the BSE fell by 1408 points to 17,605 leading to one of the largest erosion in investor wealth

On the next day on 22 January 2008, the Sensex again fell by 875 points to 16,729.

On 11 Feb 2008, the sensex fell by a further 834 points to 16,630.

On 3 March 2008, the Sensex fell by 900 points to settle at 16,677.

On 17 March 2008, the BSE Sensex fell further to 14,809 - a fall of 951 points.

On 24 October 2008, the BSE Sensex fell to 8701, a fall of 1070 points in a single day.

On 26 November 2008, the sensex continue to fall, in the bargain 
.dashing middle class dreams".

Now let us look at various scenario

Scenario one

Where investor panicked and did redemption during correction 



SCENARIO 2

When Investor sold at  last leg of correction: check losses 







Scenario 3

When Investor did not act and decided to stay invested: tax free FD returns



Scenario three

When investor decided to add on every correction: Check his last leg of investment returns










Now we are at stage two or three of correction,no one can predict. I leave it your wisdom to redeem or add more on every correction 

There are various other times when our  markets have corrected 


A Little History of Indian Stock Market Drawdowns


Global markets have been rocked many times by health crises. But they have always rebounded sharply, post the dust settles


Now I leave this to your wisdom to panic and withdraw or create wealth by adding more to every fall 

Image result for We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.



1 comment:

  1. Market behave like that but your reaction towards market correction is always looks stupid.

    You were only who recommending YES bank some time back and today crying.

    Tagging MOF or Namo wont work.

    Behave like a matured investor but being PMS advisor you always behave like a trader.

    If it is an opportunity, invest in such market. It is a wise decision. But still blue chips are over 50 PE, so we have to wait more to invest in full force.

    You are a good lady and professional and I respect you lot. But one thing is missing that is Marturity.

    Thanks Renuka
    Keep the good work ....

    ReplyDelete