COVID-19 is spreading human suffering worldwide; that is what we should all be focused on. But not all of us are doctors. Some of us are investors and economists – and COVID-19 is most definitely spreading economic suffering worldwide. The coronavirus may be as contagious economically as it is medically.
The Pandemic has led to widespread lockdowns causing the economy to grind to a halt. Since last month in the UK, the stock markets have fallen more than 30% on the Unknown Fear account.
And the key questions to address are: How, and how far and fast will the economic damage spread?
Protecting and saving money is the priority and thing to be considered for new investors today. Conservative investors can invest 30 percent in safety and risk-free investments such as FD, bonds, 30 percent in the debt funds, and the remaining 40 percent in equity funds for wealth creation.
Many investors are looking for the right opportunity or best investment with higher returns in the long run. Based on the risk considering, one can invest in equity to debt ratio in the mutual funds. Higher return with low-risk investment does not exist. The higher the risk, the higher the returns, and vice versa lower.
Maintain allocation discipline across your investment. Investors should not sell your investment in panic times. Think calmly and then make your decision. Depending upon your goal objectives, you need to reshuffle your portfolio according to current situations.
Investors should be cautious and prepare for the long haul. They should stay within the discipline of their asset allocation and use the market falls for Portfolio Rebalancing. Any excessive leveraging is best avoided at this point. It is a better approach to invest in Large-cap mutual funds in the recent haul and consider mid and small caps once the volatility reduces.
It is considered safe to get in touch with a Financial Advisor who will take the time to focus on your concerns, especially in such unforeseen circumstances. The right Advisor will ensure that you remain disciplined about your financial strategies and stick to your asset allocation and risk profile.