Respected Investor,
As we all know COVID-19 is spreading its footprint all over the world and it is impacting economy. So in this situation, it becomes difficult for the investor where and how to invest in this volatile market scenario. Hence, investor should stay away from small & mid-cap funds until market get settle.
We all have witnessed in 1992, market was approx 4,285 and it decrease up to (-46%) in next year and it had been grew up to 31,248 as of now. So, it is not for the first time market is crashing. Investors have to be patience to grow their money in this pandemic situation.
Mutual fund investor should not stop their SIP as the biggest advantage of SIP is they don’t have to time the market. It is general tendency of every buyer to buy at low price and sell at high price SIP do exactly the same thing it accumulate more units at low NAV and appreciate the same units at high NAV and buy fewer more units. SIP should not be stop as an when investor have started sip they have thought of investing for 10 years so in they have to be patience for that time horizon.
In this COVID -19 scenarios it is favourable to investor as stock valuation are undervalued which help fund manager buy good stock at cheap valuation.
Hence if investor is taking entry for the first time he / she can invest through SIP or STP mode into in large cap fund only because when market will be rallied blue chip stock will rally first and if possible for an existing investor he can double the SIP amount for at least one year to average his portfolio valuation.
Positive Points
- Because of low crude price we are the most beneficial country in the world. Crude price falls from $70 – $75 to less than $10 or near to negative which helps us a lot on a monthly basis import as well as helps govt to fiscal side.
- Stocks Price and its valuations are very much cheap levels.
- Imports only essential various goods from around world by India that saves our currency reserve.
- Low inflation and recently liquidity infused by RBI and in future time it infuses again if requires.
- As all of you know COVID -19 evolve from China, worldwide companies had started to think there plants and new development in other countries also and India can be most benefits.
