Investors like to invest when there is visibility and clarity. They invest more when the returns have been good. But the 'good' returns they see are out of the investments made when markets have been bad.
- And investors like to invest when they have money. But such opportunity (market fall) happens occassionally. When you are flushed with money - keep it aside and invest when such opportunity strikes.
- Having said that - it is not that easy to invest when market falls. Often we wait for clarity to emerge... and miss the opportunity. Hence invest gradually when market keeps falling. And it is an art to stretch your capital and invest to the maximum possible downcycle. If you have exhausted the reserved funds - do search for some more, squeeze out and invest.
- More important - do not look for consensus to invest. The person next to you may scare you. Close your ears and keep investing.
- Some investors review their existing portfolio during market fall and feel disheartened to see the pathetic returns. Donot do that. When broader market falls - everything will fall. Your portfolio alone may not be insulated. You an earmark those you would like to knock off - but do that when markets have recovered.
- Spreading your investments across industries, across assets can help you reduce volatility and improve consistency. Experts say, the ideal ratio could be 70% Equity, 15% Debt and 15% Gold.
- Investors normally like to invest only in assets which give THE BEST returns. So they switch / skew their portfolio - only to get hit when market reverses. Better to maintain a balance.
The message is simple - if you want good returns in equity - you need to take that bit of risk. No shortcuts there. Current IRAN War or rather the last 18 months market consolidation is one such opportunity. GRAB IT. Get it touch for assistance.
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