Today is The Best Time to Invest.
Bearish markets are considered the best time to invest in stock markets.
The shares that usually have high value are hovering at their 52-week low during the lockdown because of the COVID-19 pandemic.
In today’s world, saving money for the future using a savings account or fixed deposit is not the best option. Due to inflation, the value of our savings reduces drastically over time. Even if we play safe and keep fixed deposits in banks, the interest rates provided by the banks barely surpass the inflation rate.
This is where investing in mutual funds and equity shares come in. From the beginning of Sensex in 1986 to date, it has seen steady growth, and according to research, unless a huge population that consumes and produces goods go extinct, then Sensex will continue to grow.
It has seen a steady growth of 15%, and if we subtract the inflation rate of around 7%, we see an increase of about 8%, which is substantial.
Why is Today the Best Time to Invest?
Remember the time during 2008, when there was a massive recession? Those who chose their companies wisely for investment and gave the companies time to recover gained huge profits. The shares that usually have high value are hovering at their 52-week low during the lockdown because of the Covid-19 pandemic.
These charts can show how much you can gain if you invest in trusted companies now and wait for the market to recover.
Every recession allows you to be a huge gainer, a loser, or sit around do nothing. Though doing nothing sounds better than losing your money, but it’s not because eventually, the value of the money will go down due to inflation. And as rightly said, “Higher the risks, the higher will be the returns.”
If you can study the future of a company and calculate its possibility to recover, then investing right now is the best option. If you don’t want to take risks with equity, you can also go with mutual funds. Though risks in mutual funds do exist, they are much lower than equity shares where you are directly buying into the company from the market.
What Should an Investor Do?
Fact: The Indian markets have fallen over 27% this year.
Lessons from history: In the past, any fall in the price of stocks of more than 25% was considered to be good news. However, this was only for long-term investors.
Analysis: A fall of more than 25% usually implies that you can buy good stocks at attractive valuations. Hence, more value for money; more bang for the buck!
Suggestion: If you are a long-term investor looking at investing in equity mutual funds, then this can be a good time for you. Ensure that you pick the right schemes that resonate with your financial goals and risk tolerance.
If you are not comfortable taking too many risks considering the market crash, you can look at a well-diversified equity value fund. These funds follow the value investing strategy and require investors to be disciplined and patient with their investments. In a value fund, the fund manager looks for stocks that have strong fundamentals and better potential to grow over time.
It is essential to understand that choosing the right fund is the key to successful investing during such times. Find a fund that can ride out this storm and recover from the current economic crisis.
The Best Free/Easy Platforms to Trade in the Stock Market or Buy Mutual Funds
So, according to my personal experience and data, I feel the best app to go for mutual investments is Groww. The app is available in both iOS and Android stores and is entirely free to use.
As per the time of writing this article, the app is rated at 4.5/5 on the play-store and 4.6/5 on Apple’s iOS-app store.
Now for buying equity shares, the app that I would recommend would be Kite by Zerodha. The app has a very clean UI, and the signup process to get your Demat account for trading is simple.
The app provides many plugins and has very nominal brokerage charges. The signup process for equity trading costs just Rs 200, and for enabling commodity trading, an extra Rs 100 is charged. The app is available on all platforms and has a rating of 3.9 on Google’s Play Store and 3.3 on the iOS-App store.
So if you have reached the end here, you sure are interested in the share market. Just remember the opportunity you are getting now may not be there shortly. So take your share of risks, study the market, and invest wisely because there might not be a better next time ever.
Written by Reshab Agarwal and Edited by Rohan Ganguly of Fracoso.
Disclaimer: This is not a sponsored article. Fracoso or the Writer did not receive financial or any form of compensation from the websites and brands mentioned in the article. None of the links in the article are affiliate links. Moreover, this article is educational in nature and shouldn’t be considered as financial advice. The recommendations and reviews do not guarantee fund performance, nor should they be viewed as an assessment of a fund’s, or the fund’s underlying securities’ creditworthiness. Mutual fund investments are subject to market risks.The reader/investor should do his/her own independent research before investing in any mutual fund or stocks.
