“We still are in touch with our clients and explaining the situation to them. But there is no panic – it seems, investors really understand that such phases would come and they need to continue with their investments,” says Hemant Rustagi, CEO, Wiseinvest. He says investors who have been investing for a while and seen the market are absolutely fine because they have understood the game. Of course, reckless investors who were chasing returns got a wake up call, advisors say.
Ashish Modani, founder, SLA Financial Solutions, echoes the same sentiment. He says most of his clients are not much bothered about the volatility in the market. “I guess all that education is paying off. Very few investors need reassurances and explanations, he says.
Even investors say they are not unduly bothered by the market volatility and uncertainties that are haunting the investment space. “My advisor has been preparing me for this phase in the last two years. He has been saying the market may correct anytime and I should be prepared to invest through tough periods if I want to maximize returns,” says an investor who has been investing in equity mutual funds. Seasoned mutual fund investors say they remember such phases and the mistakes they have committed during such phases. They say that lesson serves them well in this downturn.
Mutual fund advisors and investors say remembering or reiterating goals help a lot to stick to plans. Several investors say this is their strategy whenever they lose their nerves in such trying situations. These investors say they almost decided to sell their investments and then remembered their advisors telling them they should focus on their goals and cut out all the noise.
Many investors also say they became more aware about risks during this volatile phase. “I used to wonder why the advisor was repeating the risk profile. He used to say you should be comfortable with the risk you are taking. Now I understand what he meant by that.”
Advisors say most investors stop investing when they get into options that are not clear to them or not suitable to their risk profile. Modani says investors who have invested in crypto currency are a classic example. “When you get into options that you don’t understand or are unsuitable to you, any setback becomes unbearable.”
Advisors say investors should not look for exotic solutions to problems associated with the stock market. “Many investors were taking unwanted risk even a couple of months ago. They thought these options would offer them better returns than regular mutual funds,” says a mutual fund advisor who doesn’t want to be named. He says investors should not fall for clever sales pitches and stick to basics. This is very important in a volatile or bear market.