With the novel coronavirus or COVID-19 spreading rapidly all over the globe, it is predicted to cost the world economy a staggering $1Tn. In this current situation, a Warren Buffet quote suits the most. He says, “Be fearful when others are greedy, and be greedy when others are fearful.”
A large fall in the equity markets amidst coronavirus pandemic over the last couple of months. At present, global markets and also the domestic markets are in a stage where the future is unpredictable. Looking back into history, there was a dramatic fall in global markets in 2001 and later in 2008, when there was a global crisis in the financial industry, which has resulted in the market crash. And now, the coronavirus pandemic has crashed all hopes of equity markets by witnessing a continuous decline with rapid fall.
Although, traders are able to make money at a one- or two-days target it is proving to be a hard time for the investors. There are some investors who are anxious to lighten up their portfolio by trading the low valued stocks. As per a recent survey, it is estimated that markets will remain volatile and the market is expected to witness more pain in this coronavirus pandemic situation.
However, this is the best time to buy quality stocks for long term investors, as these stocks can be purchased at a reasonable price. According to various market experts, this tough situation of crisis will pass and come to an end, but the most important for the investors is to keep in mind the post impacts of the ongoing markets. Thus, the investors should maintain asset provision discipline to evade any heavy loss.
What Should Investors Keep in Mind?
- Instability is a part of the share markets. Single-digit GDP numbers, economic downfall, worrying IIP numbers,high inflations are all waiting at our doors to make the situation even worse. Therefore, investors should keep calm and take right decisions step by step.
- On the other hand, it is the best time to buy stocks for long term investors, as the high valuation stocks can be obtained at low levels. But they should follow some criteria before buying any stocks such as –
- The stock should be at Zero Debt.
- The stock needs to be high-profit margin stock.
- The company should be capable enough to face the bottom and then bounce to a significant rise.
Basically, strong stocks are what people should look after the current pandemic situation.
- This is one of the worst crises, which the financial markets are facing after 1929. Many top economists demoted their forecasts to point towards an approaching global recession.
- It is extremely important for the investors to re-shuffle the portfolio as per the current coronavirus pandemic situation.
- It is a prudent time to upsurge exposure inequity in anamazed manner. Pragmatic evidence testifies to the fact that investing in the time of market crashes can produce super-normal returns over the long-term.
- US equities too are displaying a reduced correlation between the increasing COVID-19 positive cases and the stock price decline. This is a clear indication that stability is slowly prevailing and markets have presumed that it will take a while before the coronavirus cases stop driving the markets into a pause mode.
Some Stocks by the Experts’ Choice toHold/Sell/Buy
- Healthcare and pharma stocks will definitely get some benefit post the coronavirus relief when things get normal.
- Governments of various countries all across the globe will give a significant boost to healthcare in the near future.
- One can buy large-cap stocks like HUL, L&T, Castrol, and good dividend yield stocks such as Nestle for long term prospect. All these stocks should be bought as an investment point of view.
- The added stocks in your portfolio should be sold if they are not giving you any profit. Sell them immediately.
- Avoid metal sector, FMCG. And sell low margin profit stocks.
- Avoid financial sector, NBFCs, and banking stocks. As per the market experts, the worst is yet to come in the financial stocks.
Even though the market has come down amidst coronavirus pandemic, don’t panic and sell some stocks to have cash. Henceforth, it is the best time to buy fundamentally good, strong, and quality stocks if you are looking for long-term profit.