The stock market is in a total panic mode after the COVID-19 outbreak. If you watch the stock market news, then be prepared to receive a series of shocks every day. The situation is grim right now and it’s normal to have panic set in while observing the massive stock market crash. Undoubtedly, the next few months are very crucial not only for the stock market but also for the world economy.

Let’s hope everything gets back to normal soon. But amidst this stock market crisis, we have to be sane and make rational decisions. Otherwise, our financial boat can capsize anytime.

Here are a few tips to keep your head level amidst the massive stock market correction that has transpired in the last few weeks.

1. DON’T MAKE ANY INVESTMENT DECISIONS OUT OF SHEER PANIC

It’s true that the stock market is in a correction mode due to the Coronavirus pandemic. The global economy is partially paralyzed and the livelihoods of thousands of people are also uncertain. However, this is a temporary phase and hopefully, the situation will improve after this crisis is over.

Don’t make any hasty investment decisions based on the current economic situation right now. If you look back at the history of the stock market, you’ll notice that there have been steep market corrections in the past. But the market has always recovered, even if gradually.

Don’t sell your stock out of sheer panic. Wait until the situation improves. Even if you sell your stocks right now, you’ll incur a huge loss. So, what’s the point?

2. BUY STOCKS NOW WHILE THE PRICE IS QUITE LOW

Are you a smart investor? The reason why I'm asking you this question is that a smart investor would not panic when the market is volatile. Rather, he or she will take advantage of this golden opportunity and buy stocks of blue-chip companies. The price of stocks is close to rock bottom now. In relative terms, this is the best time to buy blue-chip stocks that one usually can’t buy when the market is stable owing to its high price. Unless there is something genuinely wrong with a company’s underlying fundamentals or business policy, they will get back on track once the crisis is over. You can sell the stocks when the market is up again, and reap profits accordingly.

3. BE PATIENT, AS TOO MUCH HURRY WON’T DO ANY GOOD

I’m sure you have read the story of the hare and turtle. The hare lost the race due to too much hurry. The turtle won the race as it was patient and calm. The moral of the story is whoever is slow but steady gets the ultimate victory. You have to be that turtle now. You have to be patient and think from a long-term investor viewpoint. Even if your stocks are not doing well right now, you shouldn’t sell them. Be patient and don’t watch the news on the stock market right now. You would hardly get any good news at present. Rather, read articles on tips for a happy retirement and how to build your nest egg. Do something productive.

It will take time for the stock market to recover. It will take a few months for the market to get back to its previous level. The drop has been huge. So, it will take time for traders and investors to gain confidence once again.

Don’t worry! You won’t lose anything if you act like a sensible long-term investor. Your money and retirement savings accounts will be safe.

4. DON’T CONSIDER YOURSELF THE ONLY ONE WHO IS SUFFERING

You’re not the only fish in the pond who is suffering. The whole world is suffering. Economic fears are rampant in all countries. People are panic-stricken. But amidst this fear and uncertainty, people are living with a hope for a better tomorrow. Do what makes you happy. Spend quality time with your family at your house. Read books, listen to music, meditate to calm yourself down, cook meals, watch the latest web series on Netflix, etc.

You’ll have plenty of time to take care of your money. First, save your life. If you have money, keep it in your retirement savings account. Or, use it to buy good stocks as the price is currently low.

A word of wisdom

Don’t look at your statements right now. The figures will drive you crazy. When you see that your total investment value has decreased significantly compared to last month, your mind goes blank. Who wants to see that his/her net worth has diminished?

Don’t monitor stock market news right now. You won’t get a ray of hope from there. The bottom line is, you have to wait until the stock market goes up. It will take time. But good times will come. As history suggests, this much is for sure.

CONCLUSION

Don’t lose precious sleep due to the stock market mayhem. Don't sell your stocks due to economic uncertainty. Don’t take any drastic steps. It’s time to sit back and evaluate the entire situation rationally. You have to understand one point: a stock market correction is nothing new. It has happened in the past and it will happen in the future, too. If you sell stocks right now, you’ll lose money. Follow smart investment strategies and don’t sell shares low. Stay safe and take care of your health right now. You’ll get lots of time to recover your loss and make money.

This article was written by Linda Richardson.

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