{"id":278,"date":"2020-02-19T11:17:02","date_gmt":"2020-02-19T11:17:02","guid":{"rendered":"https:\/\/www.invest19.com\/blog\/?p=278"},"modified":"2020-02-19T11:19:11","modified_gmt":"2020-02-19T11:19:11","slug":"things-to-do-in-a-volatile-stock-market-things-not-to-do","status":"publish","type":"post","link":"https:\/\/www.invest19.com\/blog\/things-to-do-in-a-volatile-stock-market-things-not-to-do\/","title":{"rendered":"5 Things to do in a Volatile Stock Market [&#038; 5 Things not to do]"},"content":{"rendered":"<div style=\"margin-top: 0px; margin-bottom: 0px;\" class=\"sharethis-inline-share-buttons\" ><\/div>\n<p>It\nhas been a wild ride in the Indian stock market in the past few weeks where\ninvestors witnessed the remarkable swings in the domestic indices in times of\nBudget and Assembly Election for 2020. On top of that, the concern over\ncoronavirus has dented the investor\u2019s sentiment very much. In just a few days,\nmany investors have seen their wealth eroded while some investors benefit from\nsuch a volatile stock market and made millions. Well, what can say \u2013 this is\nthe harsh reality of today\u2019s stock market! <\/p>\n\n\n\n<p>Whether you like it or not, you\u2019re bound to invest in such volatile stock market. So, here we\u2019ve mentioned some key things to do and not to do during the volatile stock market:<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"counter-hierarchy counter-decimal ez-toc-grey\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\"><i class=\"ez-toc-glyphicon ez-toc-icon-toggle\"><\/i><\/a><\/span><\/div>\n<nav><ul class=\"ez-toc-list\"><li><a href=\"#5_Things_to_do_in_a_Volatile_Stock_Market\" title=\"5 Things to do in a Volatile Stock Market\">5 Things to do in a Volatile Stock Market<\/a><ul><li><a href=\"#Dos_Hold_onto_Investments\" title=\"Do\u2019s: Hold onto Investments\">Do\u2019s: Hold onto Investments<\/a><\/li><li><a href=\"#Dos_Buy_for_Long-term\" title=\"Do\u2019s: Buy for Long-term \">Do\u2019s: Buy for Long-term <\/a><\/li><li><a href=\"#Dos_Add_Dividend_Stocks_to_your_Portfolio\" title=\"Do\u2019s: Add Dividend Stocks to\nyour Portfolio\">Do\u2019s: Add Dividend Stocks to\nyour Portfolio<\/a><\/li><li><a href=\"#Dos_Cut_yourself_off_the_Margin\" title=\"Do\u2019s: Cut yourself off the Margin\">Do\u2019s: Cut yourself off the Margin<\/a><\/li><li><a href=\"#Dos_Portfolio_Rebalancing\" title=\"Do\u2019s: Portfolio Rebalancing\">Do\u2019s: Portfolio Rebalancing<\/a><\/li><\/ul><\/li><li><a href=\"#5_Things_not_to_do_in_a_Volatile_Stock_Market\" title=\"5 Things not to do in a Volatile Stock Market\">5 Things not to do in a Volatile Stock Market<\/a><ul><li><a href=\"#Donts_panic_sell\" title=\"Don\u2019ts: panic sell\">Don\u2019ts: panic sell<\/a><\/li><li><a href=\"#Donts_Stick_to_Buy_at_Lows\" title=\"Don\u2019ts: Stick to \u2018Buy at\nLows\u2019\">Don\u2019ts: Stick to \u2018Buy at\nLows\u2019<\/a><\/li><li><a href=\"#Donts_Stop_your_SSIPs\" title=\"Don\u2019ts: Stop your SSIPs\">Don\u2019ts: Stop your SSIPs<\/a><\/li><li><a href=\"#Donts_Diversify_within_the_same_Sector\" title=\"Don\u2019ts: Diversify within the same Sector\">Don\u2019ts: Diversify within the same Sector<\/a><\/li><li><a href=\"#Donts_Fall_for_Leverage\" title=\"Don\u2019ts: Fall for Leverage\">Don\u2019ts: Fall for Leverage<\/a><\/li><\/ul><\/li><li><a href=\"#Final_Thoughts\" title=\"Final Thoughts:\">Final Thoughts:<\/a><\/li><\/ul><\/nav><\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\">5 Things to do in a Volatile Stock Market<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Do\u2019s: Hold onto Investments<\/h3>\n\n\n\n<p>The extraordinary swings on nominal points put fear in the\nminds of investors which results in panic selling. However, these swings are\nfor short-duration and won\u2019t last much longer. In such circumstances, the\ninvestors must hold onto their investments to ensure that their long-term goals\ndo not influence by the short-term volatility in the stock market. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Do\u2019s: Buy for Long-term <\/h3>\n\n\n\n<p>Volatility in the stock market is a good opportunity for investors who are hoping to make money in the long-term. The volatility allows such investors to make long-term investments in buying value stocks at a much-discounted price. Meanwhile, the short-term traders can capitalize on volatility on profit and <strong><a href=\"https:\/\/www.invest19.com\/blog\/importance-of-profit-booking-in-the-share-market\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"benefit from profit-booking (opens in a new tab)\">benefit from profit-booking<\/a><\/strong> in day-trading. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Do\u2019s: Add Dividend Stocks to\nyour Portfolio<\/h3>\n\n\n\n<p>Though nothing is sure with the stock market the dividend stocks have the reputation of providing consistent returns even in times of immense volatility. After all, a company wouldn\u2019t bother to pay a dividend to its shareholders if the company\u2019s board of directors didn\u2019t have a positive outlook for the company. The dividend stocks work as a cushion in the times of correction when the underlying stock may fall but you\u2019re still eligible for timely dividend income. If its <strong><a href=\"https:\/\/www.invest19.com\/blog\/growth-vs-dividend-stocks-meaning-comparison-where-to-invest-in\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"dividend stock vs. growth stock (opens in a new tab)\">dividend stock vs. growth stock<\/a><\/strong> then dividend stock has the natural ability to attract the investors. <\/p>\n\n\n\n<p>And it\nis not just high dividends that make them suitable but the years of consecutive\nincrement in dividend payouts as the result of a steady increase in the company\u2019s\nnet earnings. The dividends received can be re-invested to increase the\nquantity of dividend-paying stock, which can fasten the pace of wealth\ncreation. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Do\u2019s: Cut yourself off the Margin<\/h3>\n\n\n\n<p>If\nyou happen to be using the leverage (i.e. margin) on your existing investments,\nconsider this volatility as a wake-up call to cut that investment out. No\ndoubt, the margin employed in an investment can result in huge gains but it can\nalso be a path to steeper losses in the times of corrections. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Do\u2019s: Portfolio Rebalancing<\/h3>\n\n\n\n<p>A\nvolatile stock market is the best time to take some time out to rejig your\nstock investment portfolio. During the volatility market, your initial asset\nallocation could be disturbed so to restore the portfolio to its initial asset\nallocation, it is wise to rebalance portfolio period. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">5 Things not to do in a Volatile Stock Market<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Don\u2019ts: panic sell<\/h3>\n\n\n\n<p>It\nhas often seen that many investors overwhelmed with the fear of losing give in\nto the speculations and start panic selling. Remember, the volatility in the\nstock market is temporary. It won\u2019t last long. If you\u2019ve invested for long-term\nthen don\u2019t jeopardize your investments in selling at low prices. As long as you\nhold on to your investments, it won\u2019t be a real loss. However, it will become a\nreal loss if you sell. <\/p>\n\n\n\n<p>Don\u2019t\nforget \u2013 <em>This too shall pass! <\/em><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Don\u2019ts: Stick to \u2018Buy at\nLows\u2019<\/h3>\n\n\n\n<p>It\nsounds debatable since we just put \u2018Buying\u2019 in our things to do in the volatile\nstock market but it is to remember that sometimes it\u2019s a trap. You cannot\nalways anticipate the bottom of the stock price like \u2013 <em>how much it will go down in value? <\/em><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Don\u2019ts: Stop your SSIPs<\/h3>\n\n\n\n<p>Whatever\nyou do, do not stop your systematic investment plans in stock investing. On the\ncontrary, the bearish phase is exactly the right moment to continue your SSIPs\nto buy a certain stock at a low price to address your long-term financial\ngoals. <\/p>\n\n\n\n<p>Stopping\nSSIPs mean to miss out the advantage of compounding benefit of equities. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Don\u2019ts: Diversify within the same Sector<\/h3>\n\n\n\n<p>Diversification\nis a good strategy to minimize the losses within the stock investments.\nHowever, the declining market led to many stocks of the same sector available\nat discounted prices. When that happens, investors tend to diversify their\nportfolio by buying the stocks in a single sector at discounted prices at once.\n<\/p>\n\n\n\n<p>Or\nbetter, do not watch your investment portfolio too frequently. This is what\nleads to the financial anxiety which leads to fear-driven decision making and\nimpulsiveness which will affect the long-term performance of your portfolio. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Don\u2019ts: Fall for Leverage<\/h3>\n\n\n\n<p>Although\nthe recent SEBI norm has banned margin investing but still many investors use\nborrowed capital as a loan to finance the shares to optimized returns. You\nshould avoid it, especially when the stock market is volatile. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Final Thoughts:<\/h2>\n\n\n\n<p>As mentioned above, volatility is a major concern of\ninvestors investing in the stock market, yet can benefit any investor who is\nwilling to take it as an opportunity to turn this volatility into his\/her favour.\nHowever, if moves carelessly, an investor can lose big. So, it is important to\nfollow the right strategy to continue moving forward in times of volatility in\nthe stock market. <\/p>\n<div class='epvc-post-count'><span class='epvc-eye'><\/span>  <span class=\"epvc-count\"> 5,538<\/span><\/div><div class=\"pld-like-dislike-wrap pld-template-1\">\n    <div class=\"pld-like-wrap  pld-common-wrap\">\n    <a href=\"javascript:void(0);\" class=\"pld-like-trigger pld-like-dislike-trigger \" title=\"\" data-post-id=\"278\" data-trigger-type=\"like\" data-restriction=\"ip\" data-ip-check=\"0\" data-user-check=\"1\">\n                        <i class=\"fas fa-thumbs-up\"><\/i>\n                    <\/a>\n    <span class=\"pld-like-count-wrap pld-count-wrap\">5    <\/span>\n<\/div><\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>It has been a wild ride in the Indian stock market in the past few weeks where investors witnessed the remarkable swings in the domestic [&hellip;] <span class=\"read-more-link\"><a class=\"read-more\" href=\"https:\/\/www.invest19.com\/blog\/things-to-do-in-a-volatile-stock-market-things-not-to-do\/\">Read More<\/a><\/span><\/p>\n","protected":false},"author":1,"featured_media":279,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[47],"class_list":["post-278","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stock-market","tag-volatility-in-stock-market"],"_links":{"self":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/278","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/comments?post=278"}],"version-history":[{"count":3,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/278\/revisions"}],"predecessor-version":[{"id":282,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/278\/revisions\/282"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/media\/279"}],"wp:attachment":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/media?parent=278"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/categories?post=278"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/tags?post=278"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}