What should we do in this falling market?
What should we do in this falling market?
I guess that there are very few who can keep their anxiety and mind in control when they witness the equities that they have invested in going down continuously on each trading cycle. Everything at the current price looks like a good investment, but when you invest on it to find that the price has gone further down. It looks like you are out of the investment capital as well you have locked out your capital in the "unrealized" loss, because if you want to take out the capital by selling these equities, you will lose money.
I guess for the past few days, I am wondering the same, investing my money ,considering it as good opportunity and only to wake up another morning to find that today is even better opportunity to invest and whatever invested yesterday is currently unrealized loss.
This is how the Indian Stock market performed for last month, and I actually suffered more as my major investment in the Indian IT sector and it is almost down by 25% in last 3 months, and in my case , this investment lost almost 40% .
Since overall market is down, so my Non IT investment is also not doing great too.
So what is my current strategy?
a.) Understanding Risk.
I am no longer blindly averaging out and focusing on understanding the sector outlook in the future. If market sentiment is "currently" uncertain of a sector, then in the future it will go further down and it is good to have keep distance from it.
b.) Future potential.
I am keeping my position on the sectors that do not have any negative news and I believe thay have future potential too. In current trend, I feel renewable energy sector is one of them. I also feel banking sector will also be a good choice.
I guess bear market is a complicated topic, when it is there, it brings negative emotions to most people that they are losing value in their investment. When this bear market phase pass, then many will be regretting that why did not they invested on that phase of the market.
I will only suggest that just select best equities, not the cheapest one and only invest that you can afford to lose.
Markets are unpredictable so do your own research and it is better to take a look on data to make that decision, and do factor this point that how a sector performed in past is not a gurantee for it's future performance.
I looked at my account for the first item in a while just yesterday. I noticed I was down a couple of five figures, but it wasn't as bad as I thought it was going to be. I plan on just keep buying like I do every month. I know it will recover and when I am ready I will move the money to a more stable alternative.
That is one of the valid choice because we do not know the real bottom. Only thing is that we should have clarity what we should buy and how it or secor perform in future.
For example IT sector is good sector but in current AI uncertainty, I am not trying to buy it cheap.
Since I'm not involved in stocks, I'm not worried about the market downturn. In fact, I'd like to see the end of a cycle; I'd like to see a trend reversal in global markets.
Everyone want to see the cycle end but war in different parts of world making it difficult.
!PIZZA !LOL
The markets are unpredictable, and I agree that its tough. During a bear market, we can probably expect some companies to go bust, but I do agree that the best ones representing the industry probably won't fall. As for stocks that I think that are good, it would be something that people will still buy. For example, people will still be buying soda and things like that.
Yeah, few of stocks can be considered as the evergreen stock that's in FMGC sector.
!PIZZA !LOL
The ongoing war in the middle east has heavily affected the market across the world
I hope this war ends soon.
!PIZZA !LOL
I recently had a financial need and I sold one of my stocks. I know that I was selling it when the market was extremely down. But to my good feeling, the market fell further down after my selling making me feel a lot better. Lots of inconsistencies as you said and hard to predict.
Market is down for both crypto and stocks.
!PIZZA !LOL
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Thanks for curation. !PIZZA !LOL
those are not looking so good chart samples. Most of the existing business sectors are still heavily dependent to oil and gas. War is really is a heavy blow not just to business but most of the countries economy.
Let see, how it unfolds. look like war will continue but trade of oil and gas will not be disturbed.
20% of global market was on hold on straight of hormus. We are really affected by that. The oil price hike here on our country (philippines) was already causing economic disturbance. I just really hope that our government can find another supplier for the petrol products
I agree with the strategies, it is very crucial to understand the risk before investing on something
!BBH
Yeah, we should always factor risk and loss in capital. !PIZZA !LOL
100% agree on that
Same, seeing locked-up capital drags down the mental game. Hope the market recovers soon.
It is really painful to see the investment value erode.
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