There is no certainty where markets may go in times ahead, says Dhirendra Kumar
Do you expect a correction in the broader market in the next three to six months, which can present a good buying opportunity in the long term?
There is no certainty. I am actually surprised by the way several stocks have made a comeback so soon. During my recent discussions with some of the people who have great knowledge about markets such as fund managers, market men, etc., they have revealed that the current crisis shall have varied effects on different businesses. While some of the businesses may witness a temporary reduction in demand, supply and production, some businesses may be hurt in a fairly permanent way. Earnings for different businesses may have varied impact.
Thus, with so much uncertainty prevailing in the market currently, one needs to make an investment plan and stick to it, irrespective of where the market moves. Make a plan as to at what levels you will invest if the market observes any further correction. One thing to note here is the importance of sticking to your plan. There may be a situation where you will invest and the markets may have further corrections and can remain there for long. One tends to have regrets at such instances and the chances are that you may lose faith in the market and never invest again. So, you have to have control of your mind. Make a plan and execute it. There is no looking back. In the long term, markets tend to reward investors.