Market has tanked big time today. What should your strategy be?

The market is a sea of red today. At the time of writing, investors have lost over Rs 20 lakh crore in a single day, as the election results have spooked investors. At such a time, it is natural for us investors to panic and sell our equity investments. However, such knee-jerk reactions are not only harmful to your knees but also to your wealth. Here's why: if you look at the accompanying table, we have identified six days since 2008 where the Sensex - a proxy for the Indian equity market - has tanked 6 per cent or more. But guess what, the market eventually recovers; in some instances, as in March 2020, the markets recouped a 13 per cent loss in as little as three trading days. Even if it takes 148 days for the Sensex to recover the 7 per cent loss it was inflicted on November 11, 2008, it has rebounded handsomely, delivering 20 per cent and 16 per cent returns over three- an

This article was originally published on June 04, 2024.