Russian attacks on Ukraine have begun. Bomb blasts have been heard in different cities of Ukraine. Due to this news, the BSE Sensex broke up to 1800 points in early trading in the domestic market today. The market has become quite volatile since last October after a strong rally of nearly 18 months. The market has seen a sharp decline in the last few weeks. The Sensex was circling around 55,000 in this morning’s trading. As an investor, you will be very concerned about the safety of your investments. In such a situation, we are telling you some ways in which you can protect your investment.
Do not stop SIPs
Whatever you do, do not stop your systematic investment plans (SIP). Continuing with SIP in this volatility of the market is a good strategy. A study by IDFC Mutual Fund has come out of investors who maintained their SIP at the beginning of the COVID-19 market crash and those who maintained this SIP for 2-3 years have benefited more than those who panicked about maturity. First stop your SIP.
Joseph Thomas of Emkay Wealth It says that whether Russia-Ukraine tensions or high crude oil prices are not going to last long, it would be a better option to invest in mutual funds through SIP to take advantage of the current volatility.
Invest, Not Speculation
Too many investors buy stocks themselves. Some of them trade in derivatives. In the current situation, it would be advisable to avoid taking overnight long positions during this period of high volatility. If you have not done hedging, you can incur huge losses during this period of high volatility.
Nifty-Sensex fell by about 3%, the important reasons that are pulling the market behind
Thematic Investing Review
During the last 2 years many thematic funds have been launched and investors have also placed bets in them with the lure of big profits but keep in mind that there is a lot of risk involved with thematic funds but from the perspective of market players, some thematic funds can be invested in. The ones that look good. Vijai Mantri of JRL Money says that PSU equity funds, thematic funds linked to financial and infrastructure look good but don’t invest more than 10 per cent of your overall portfolio in such funds.
Diversify Portfolio
On volatile days, you may find some stocks cheaper than before in case of market downturn but there is no guarantee that it will not fall further. There are many investors who want to invest in ETFs to take advantage of intraday volatility. In such a situation, Vijai Mantri advises retail investors to bet on flexicap funds and multi-cap funds in this volatile market situation.
Another expert says that in such situations, money can also be invested in ETF funds. However, your equity portfolio should have a higher share of actively managed funds in volatile times. Keep in mind that this volatility is not going to end very quickly, the market may remain down for some time, so new investors and investors with low investment potential would be advised to invest through balanced advantage funds. Which provide a great deal of protection against risk in such situations.
Don’t neglect investing in gold
Investing in gold can be a safe investment option in times of huge volatility in the market, so put 5-7 percent of your portfolio in gold.
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