2022 has probably been the worst year for investors after 2008. The market kept plummeting, and we kept switching between the thought of holding stocks and selling them.
The better part of the year has gone into hoping the market will break records again as it did in 2021. While Sensex might be a bit far from shattering another glass ceiling, this blog is your hope to not lose your hope in investing.
As opposed to the most recent bearish runs, the falling markets can't be pinpointed for one particular reason but as a result of several events. What we are ignoring here is that many of these events happened for the first time.
For example, we never had a demonetisation until we had one, we never had a pandemic until 2020, and we never had a global financial crisis until we had one. Yes, you can argue that the Fed is not responding in the market's best interests, but many events that have occurred in the last 15 years are unprecedented. We have not seen many of these in most of our lifetimes.
So, fear and sentiment have a significant role to play in the performance of the market. We have been witness to it in during the demonetisation and the pandemic.
How well you recover from this slump is determined in part by the length of your perspectives but more significantly by how you react. It's natural to feel compelled to sell your stocks before your remaining assets are smashed to smithereens. It's also natural to freeze, paralysed by the fear that any action you take will exacerbate the situation.
"Always go against the tide, but when others are selling and sell when others are buying."
In a bear market, investors who put all their cash in at once are much more inclined to be disappointed and bailout. Those who invest regularly are less concerned with purchasing at the wrong moment, making it more straightforward to keep investing.
In conclusion, it would only be apt to stay that runs, whether bearish or bullish, ain't last forever. More than the timing, the time spent in the market determines the returns an investor receives.