[pradkumar]

It does not look all that bad when you see the larger picture. This too shall pass! Calm down.

[Santoshbhat]

Originally Posted by saket77

I think we should brace ourselves for another session in red tomorrow. US, CAC, FTSE, SGX Nifty-all under huge pressure.

That is the worry. Where are we headed? Even the calm 'long term investors' will start panicking if this trend continues for a few more sessions. I don't think any good news is coming in the next few days. Only the slowing down of number of new cases will turn this around. A very bumpy ride ahead folks.

[pradkumar]

It may feel like 2008 all over again, but here's how the coronavirus crisis is different

Take a breath. While the toll the infection ultimately takes on the nation isn’t clear, the economic upheaval caused by the outbreak will likely not be nearly as damaging or long-lasting as the historic downturn of 2007-09.

https://www.usatoday.com/story/money...08/5012228002/

[saket77]

Originally Posted by Santoshbhat

That is the worry. Where are we headed? Even the calm 'long term investors' will start panicking if this trend continues for a few more sessions. I don't think any good news is coming in the next few days. Only the slowing down of number of new cases will turn this around. A very bumpy ride ahead folks.

Actually true. None of the analysts in the industry are stating any numbers regarding the downside. No good news expected from any corner as you stated. Now it all depends on how this virus situation pans out globally.
Ironically, Shanghai was down only 1.5% today!

[RiGOD]

Boy oh boy! The conversations in this thread is a text book example of two kinds of people, or may I say investors. Time and again we've been told by the wise men that stock market crashes are inevitable and cool headed value investors find it the right time to swing.

I'm such a novice when it comes to market statistics. Still I feel that our markets have been running irrationally bullish for quite a while now and any such runs without proper backing from the economy is bound to end like this (I don't like to put the whole blame on Corona, it was just a trigger). Now let it cool off for some time. Indian economy really needs a looking into at this moment and let this be the trigger for that. Our's is a country that has still so much headroom to grow and I am confident that we'll come out of this sooner or later.

Vishal Khandelwal of Safalniveshak.com had beautifully put the whole idea into a drawing. Do replace the 'budget' part with 'market crashes'.

In the mean time, the rookie I am would keep my head cool, continue with my 50:50 investment strategy and wait for the day when the bull wakes up

[carboy]

Originally Posted by RiGOD

In the mean time, the rookie I am would keep my head cool, continue with my 50:50 investment strategy and wait for the day when the bull wakes up

How would you define "when the bull wakes up"?

Originally Posted by saket77

Ironically, Shanghai was down only 1.5% today!

China has banned shorts & taken various other measures to manipulate the market.

[Oxy]

I somehow find the government backed recurring deposits very attractive in the current market scenario. Here's an example:

https://www.indiapost.gov.in/Financi...g-schemes.aspx

An excerpt from the above:

From 01.07.2019, interest rates are as follows:-
7.2​ % per annum (quarterly compounded)
On maturity INR 100/- account fetches INR 7231.38 . Can be continued for another 5 years on year to year basis.

This translates to a clean 20% risk free guaranteed return over five years, basically it's like a PPF instrument without any investment limit.

Do mutual funds typically generate substantially higher returns than this?

[carboy]

Originally Posted by Oxy

From 01.07.2019, interest rates are as follows:-
7.2​ % per annum (quarterly compounded)
On maturity INR 100/- account fetches INR 7231.38 . Can be continued for another 5 years on year to year basis.
This translates to a clean 20% risk free guaranteed return over five years, basically it's like a PPF instrument without any investment limit.

How did you get from 7.2% to 20%?

[RiGOD]

Originally Posted by carboy

How would you define "when the bull wakes up"?

My five year old MF portfolio was giving an annualized return of ~ 10% and now it's down to ~5%. So whenever it gets back to providing me my targeted returns, it'll be a bull market for me

Originally Posted by carboy

How did you get from 7.2% to 20%?

7.2% CAGR over five years appreciates the invested capital by 20% (absolute returns). I think that's what he way trying to say.

[Oxy]

Originally Posted by carboy

How did you get from 7.2% to 20%?

It says INR 100 invested per month for 5 years (which is a total investment of INR 6000), becomes INR 7231 on maturity. That is 20% returns over a 5 year period.

Just wanted to know if debt mutual funds or long term equity returns are substantially higher in general.

[carboy]

Originally Posted by Oxy

It says INR 100 invested per month for 5 years (which is a total investment of INR 6000), becomes INR 7231 on maturity. That is 20% returns over a 5 year period.

It's pointless calculating total returns. You need to look at annual returns if you want to compare different kinds of instruments. Annual return comes to 7.2% which is better than many of the super safe debt funds.

[SoumenD]

Wow, the free fall continues. Everyday its a new record fall now. 3000+ points crash. Sensex touches 2900 mark. That's 2017 March numbers. Nifty breaches 9k levels. Trading halted for 1 hour

Can we officially call it a recession now?

[carboy]

Originally Posted by SoumenD

Can we officially call it a recession now?

Recessions aren't defined by the stock market. They are defined by the economy. The stock market has been a poor proxy for the economy in recent years.

[Sawyer]

The stock market indices are like a thermometer that measures the symptom, fever. The reason for the fever in this case is fear, even panic - not a recession. And selling now is advisable only for those in desperate need for funds, because that way the paper loss is converted to a real one.

Of course, in this case, given enough time the thermometer can trigger the disease, recession. Because if no one invests the money received from selling back into economic activity, that activity then declines in a vicious cycle - ending in a real recession.

The whole recession thing is an outcome of aggregate emotional and irrational responses of the citizenry, which is why it is so easy to break the economy by things like demonetisation, but not so easy to get it going again. It is like all the kings horses and all the kings men could not put Humpty together again. And there are enough things lurking like the present reason that can break the economic engine, so why add man made reasons to do just that?

Anyway, that is history, although it leaves us in a less capable state to weather the crisis. As an economy, we are afflicted with underlying conditions that make us more vulnerable to the crisis, as people with such conditions are to the virus.

And for those with the stomach for it, when fear rules the markets, is the best time for canny buying.

For the rest, pray for an Act of God.

[poloman]

Originally Posted by warrioraks

Poloman, I get that the point that you have been emphasising from last few posts is that that timing is very important when investing in MFs.

But can I ask you if there is a suggested way to do this? Considering the bloodbath right now, is it time to sell or is it time to buy?

Seriously I don't know man. But better to stay away from market in these times. Don't sell in panic at huge losses. What goes down will come up and what goes up will come down. It is mostly a zero sum game. How much money you make or lose depend a great on your luck, timing and of course, knowledge of markets.

But if you own any of so called multibaggers or chor companies, salvage what ever you could and run away. Most of these will be gone for ever after such blood baths.