Want to become rich in Coronavirus hit economy? Top 5 Warren Buffett inspired money-making tips
Warren Buffet suggests, be greedy when the world is fearful and fearful when the world is greedy. The recent spread of Coronavirus or COVID 19 virus spread is like that.
How to become rich in a very small time is a common question that the majority of the investors ask from their investment advisors. However, very few could achieve their target. Warren Buffet suggests, be greedy when the world is fearful and fearful when the world is greedy. The recent spread of Coronavirus or COVID 19 virus spread is like that. If it is hitting the markets dearly, it is giving a window of opportunity for the investors who believe in taking high risk for higher returns. According to the investment experts, once the effect of Coronavirus is gone from the global economy, quality portfolios are bound to shoot up at a faster rate giving very high returns in a very short time to those who dare to invest in current Coronavirus hit economy.
Speaking on how to make investments in Coronavirus hit economy Hemant Sood, Managing Director, Findoc said, "Financial market investments are heavily dependent on smart moves and positive market sentiments. Calamities and medical pandemics can dwindle markets beyond control. The global stock market has been tumbling, leading to a sell-off in most of the global bourses. Stock prices are also falling due to the fear that coronavirus will grow into a significant international health crisis. The Indian market too has witnessed a hit due to coronavirus." He said that, on the hind-side, the greater the risks, the better the profits are for investors, but only for the ones with deep pockets. Retail investors need to be cautious during such situations.
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Sood went on to add that the best policy for a retail investor is to play a long-term game with value stocks to create wealth for the golden years of his life. With the present flu in global markets, retail investors should not take decisions in haste and do the following:
1] Invest in the right stocks: Though the situation is likely to remain transient and temporary, but it is difficult to take a call on market performance. Hence, it is very important to do research. If retail investors have liquidity to invest, it is suggested to wait for the moment and conserve until the end of the global crisis.
In case, one has already made investments, it is suggested not to sell stocks out of hassle and ride out this uncertainty. We can also aspect the recovery to be very steep for stock prices and the economy, hence, wait and watch is the mantra. However, the importance of researching is very crucial not only during tough times but also when the stock markets are giving handsome results.
2] Avoid travel stocks: Travel stocks should be avoided for the next one year. Financial markets will take time to recover from the scare of deadly coronavirus. The best bid is to avoid stocks of travel companies that are focusing on South East Asian countries. In case you are holding quality stocks that have kept a balance in offering global travel destinations, it should be held for a longer period of time. The stocks should not be sold looking at the current market volatility.
3] Don't make decisions in haste: If you think you are holding quality growth stocks, never get hassled by market movement. One should wait for the crisis to be over and done with. It is always suggested to plan for the long term for better results. There are chances that the recovery might take place in a V-shape module and lead to better ROI in the longer run. The key to making a handsome retirement corpus is to sit tight and not sell in haste or without considering the impact.
4] Mutual funds as an alternative: Timing the market has never been an easy task. If you think you can devote time and energy in researching for a value stock, it is only then suggested to put monies in the stock market. Otherwise, the best is to leave the investment decision to experts. In short, if you are time-pressed, go for mutual funds. Also do not go with any mutual fund but choose them after thorough research. Always review your mutual fund portfolio every six months.
5] Algo suggested baskets: Besides trading platforms; machine learning also helps in designing baskets for investors which suit the client’s risk profile, taking into consideration the market environment. These Robo advisors develop tools or baskets to which one can customize the needs of the investors; they can also help in diversification of the portfolio. Various investment advisors have developed algorithms considering the risk profile of their investors. Algo-advisory is not completely risk-free under the current circumstance, but a better and safe bet than trading directly in the stock market. You need to choose an investment advisory firm which can help you gauge your risk profile and suggest you the right tools for creating a nest for retirement.
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