The Indian Market indices gas fallen by 10% from it's all time high, and the worst one is the Smallcpaap which has fallen by over 20%. Now people who were investing in small and midcap are getting panicked attack because their portfolio has gone done considerably. And I am seeing so many posts on when the market will recover, is it the fall of Indian Market, blah blah.
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They started to come out of the market fully or have stopped investing totally. They started stopping their SIPs and saying that they will come to the marlet when the market improves or starts to go up. Actually I don't support this. If people ask me, I will say that we should continue to invest via SIP I.e. Systematic Investment Plan. Now most of the salaried people invest for the long term and we should not worry about the short term market going up or down. We are not a trader, for long term investors this volatility actually helps us in the long term.
The small cap has given a great returns in last 4 years and thus we are seeing the decrease as all the stocks are over values. So now if we continue to invest and buy the dip we will get more units. People say that they don't have money for buying the dip, that's what people are doing it wrong. We should not continously invest when the market is going down if we have money crunch. What we should do is to continue investing using te SIP because if you are salaried then no matter oif the market goes down or up you will get the salary. And then using the salary you invest.
If people have more money then they can buy the dip at regular interval rather than investing everything at once. Since no one can time the market its better to continue the SIP because you are not sure what is the bottom or what is the top so keep investing and get the NAV as per the market and enjoy the long term benefit.
