There has been a sharp correction in the financial markets due to the global pandemic caused by the coronavirus. Moreover, the nationwide lockdown and staggering economic growth have dented investor confidence and thus gave rise to feelings of panic. That being said, it is recommended that investors understand the concept of market volatility from a historical perspective, when similar market corrections occurred in the years 2008 and 2011.

A smart investor can consider the following during current market conditions:

  • Consider building an emergency fund, taking care of any unpleasant expenses caused by unforeseen circumstances, such as job cuts or salary delays, medical expenses that can ruin one’s financial situation.
  • Re-evaluating the asset allocation of your portfolio and making a prudent decision to ensure that it suits your individual investment strategy and your financial needs, current risk appetite and time frame for investment.
  • Avoid panic selling or waiting for the right time to invest in the markets. The current scenario can be seen as an opportunity for those who want to embrace the volatility of the market while allocating their assets as per their investment objectives.
  • To continue investing through a systematic investment plan (SIP) Because they provide rupee cost averaging to equalize your costs over the investment period.
  • To build up their emergency corpus over time, investors with relatively low risk appetite can consider investing in liquid funds, where you can park your surplus money and the instant withdrawal facility provided by some mutual fund houses can choose the option. This facility allows the investor to withdraw a fixed amount which is credited to your bank account within a few hours of redemption. Also, no exit load is applicable for withdrawing money after seven days of investment in the fund. Investors are advised to read the SID or Scheme Information Document for more details on redemption of units in a particular Liquid Mutual Fund scheme.

An investor education initiative.

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www.icicipruamc.com/note To know more about the process to fulfill the Know Your Customer (KYC) requirement for investing in mutual funds. Investors should deal only with registered mutual funds, details of which can be verified on SEBI website
www.sebi.gov.in/intermediaries.html, For any queries, grievances and grievance redressal, investors may contact the AMC and/or Investor Relations Officers. In addition, investors can also file complaints on
https://scores.gov.in If they are dissatisfied with the proposals made by the AMC. The SCORES portal allows you to register your complaint with SEBI online and view its status later.

Mutual fund investments are subject to market risks, read all the scheme related documents carefully.

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