There is bull market, there is bear market and then there are times when it seems like as if the earth has been hit by a meteor just like the Jurassic age! The current coronavirus scare is definitely making the capital markets shiver in “fear”, a fear which is mindlessly propagated by media, news channels and the biggest culprit social media. There is no doubt that it is a time to stay cautious and take all the preventive precautions to keep ourselves at bay from Coronavirus. But let’s not get carried away from this “fear” factor.
These are the times that truly help you figure out your risk appetite and risk profile! This is the time to observe your reactions carefully and decipher! These are the times that test an investor’s patience and risk tolerance. These are the times that create future wealth accumulators. These are the times that test how rationally we think. These are the times that help you clearly segregate how “fear” and “greed” drive capital markets and how investor behavior is affected from herd mentality and panic states!
Trust us, all the model portfolio stocks have been screened and analyzed with a multi-pronged approach wherein the most important criteria are - a robust business model and strong fundamentals. Having seen and experienced this before in the 2008 Subprime Crisis, a sincere advice to all the model portfolios users is to stay invested and avoid looking at your portfolios till the time this coronavirus fear subsides. We know that the portfolios will be bleeding red but avoid that panic and refrain yourself from selling these assets. By selling these stocks an investor will be making his/her notional losses permanent!
Please do understand the most underrated and unappreciated superpower that we humans have is our resilience! World Wars, Asian Crisis, and the most recent financial crisis of 2007-2008, mankind has bounced back every single time! Emotions will change drastically as soon as a vaccine is discovered for Covid-19, it may take 6 months or a year and that’s the time an investor will truly know that it was right to stay put!