Have more multi-cap approach for investing right now

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As we all know , because of the Coronavirus epidemic, Many countries in the developed world have announced rate cuts, stimulus packages etc. These rate cuts were announced when the markets were already falling. Now, investors may be panicking because such sharp rate cuts may suggest fears of the US economy slipping into a recession. If the Covid-19 virus does not subside within the next few months, the global economy may slip into a recession in the next financial year.

The big question here is , with all the global fear and panic, will India’s own recovery be pushed further forward or not.It is understood that March quarter will be a white-wash.Any recovery is likely to happen only in the September and December quarters. Much depends on how the Coronavirus problem is solved or its spread is contained.

With the current market fall, stocks that were expensive have corrected by 25-30% and have become attractive to people. For such investor, it is advisable for investors is to take a more multi-cap approach rather than going only for mid and smallcaps. It is advisable to take the SIP route. May be you can take the daily or weekly SIP route. We are in an unchartered territory as far as markets are concerned. Oil prices too have crashed and the blackswan event of the Covid 19 epidemic is still spreading. So, it is better to tread cautiously.

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