• Products
    Investment Suite
    Stocks
    Mutual Funds
    Future and Options
    IPO
    Exchange Traded Funds
    Commodity
    Stockcase (Stock Baskets)
    Currency
    Non Convertible Debentures
    Sovereign Gold Bond
    Exclusive
    NRI Account
    Corporate/HUF Trading Account
    Private Client Group
    Features
    SipIt
    MTF
    Investment Suite
    Exclusive
    Features
  • Platform
    Trading Platforms
    Kotak Neo App & Web
    Nest Trading Terminal
    NEO Trade APIs
    Features and Tools
    MTF
    Securities Accepted as Collateral
    Margin Requirements
    Equity Screeners
    Payoff Analyzer
    Calculators
    SIP Calculator
    Lumpsum Calculator
    Brokerage Calculator
    Margin Calculator
    MTF Calculator
    SWP Calculator
    CAGR Calculator
    Simple Interest Calculator
    ELSS Calculator
    Step up SIP Calculator
    All Calculators
    Trading Platforms
    Features and Tools
    Calculators
  • Pricing
  • Research
    Research Calls
    Long Term calls
    Short Term calls
    Intraday calls
    Derivatives calls
    Pick of the week
    Top Monthly Picks
    Research Reports
    Fundamental Research Report
    Technical Research Report
    Derivative Research Report
    Research Calls
    Research Reports
  • Market
    Market Movers
    Share Market Today
    Top Gainers
    Top Losers
    Stocks
    Large Cap
    Mid Cap
    Small Cap
    Indices
    Nifty 50
    Bank Nifty
    FinNifty
    Nifty Midcap India
    VIX
    All Indian Indices
    Mutual Funds
    SBI Mutual Funds
    HDFC Mutual Funds
    Axis Mutual Funds
    ICICI Prudential Mutual Funds
    Nippon India Mutual Funds
    All AMC's
    IPO
    Upcoming IPO
    Current IPO
    Closed IPO
    Recently Listed IPO
    Market Movers
    Stocks
    Indices
    Mutual Funds
    IPO
  • Learn
    Stockshaala
    Basics of Stock Market
    Introduction to Fundamental Analysis
    Introduction to Technical Analysis
    Derivatives, Risk management & Option Trading Strategies
    Personal Finance
    Resource
    Market Ready
    Kotak Insights
    Infographic
    Podcast
    Webinars
    Youtube Channel
    Quarterly Results
    Investing Guide
    Demat Account
    Trading Account
    Share Market
    Intraday Trading
    IPO
    Mutual Funds
    Events
    Budget 2025
    Muhurat Trading
    Share Market Holiday
    Market Outlook 2025
    Stockshaala
    Resource
    Investing Guide
    Events
  • Partner
    Business Associates
    Kotak Connect Plus
    Startup connect
  • Support
    FAQs
    Circulars
    Bulletins
    Contact Us
    Forms Download
    Get your Statement

In Times Of Coronavirus: Everything You Need To Know About Your Investments

  •  3m
  •  1,094
  • 20 Apr 2023

Imagine the chaos: Global stock markets have gone into a tailspin, industries are shutting down, and countries are announcing lockdowns due to COVID-19. In less than a month, Indians find themselves in the middle of a global storm that has disrupted the lives of every citizen. Some sectors, such as aviation, are already cutting salaries and we will know about the magnitude of job losses only at a later date. During such times, money management and supplies become the core focus of all families. But what works for one person may not work for another. A few money management tips for four categories of people:

You will survive this financially. For someone with three-six months’ emergency funds in place, well invested and without much loans, this is time to be calm. Nishant Agarwal, Managing Partner and Head – Family Office, ASK

Wealth Advisors says: “Things will be relatively more comfortable for such people. Despite the historic fall in the stock market, this investor should not worry too much. Even the temptation to change from one fund to another can be kept on hold until things become clearer.” There are chances that there could be another bout of correction if the news flow worsens. But then, things may improve for the better as well. No action is the best action in current times.

If you are someone who has not invested enough in equities and are sitting on cash right now, this is the time to invest. Adds Agarwal: “Thank your luck that an opportunity like this has come. You can start by buying into large-cap equities through index/exchange-traded funds/mutual funds or portfolio management services. You can invest anywhere between 5 per cent – 8 per cent of this cash. And build up to full allocation slowly and steadily.” Even if you have money in equities, you can still increase the exposure over the next three months. Nitin Rao, CEO, InCred Wealth Management, says: “We prefer actively-managed funds, portfolio management services and high-quality stocks for equity allocation. Conservative investors can look at index funds or index ETF. Even debt investors can invest in AAA rated corporate bond funds to maximise their debt returns. An asset allocation review is also recommended.”

An emergency fund is perhaps the most critical thing today. But how should you create that? The options are: Switch from equities or equity mutual funds to liquid finds or redeem bank deposits. Raghvendra Nath, Managing Director, Ladderup Wealth Management, says: “Since these people do not have emergency funds and equities are languishing, you should not sell them.” If you have some money in fixed deposits and other debt funds, try and utilise them to create an emergency fund. Even gold would be a good idea since it is going up. You could borrow against physical gold or sell if you have it in exchange-traded fund format. And of course, if you have idle money lying in accounts, it would be a good time to consolidate bank accounts. M Barve, founder MB Wealth Solutions, says: “Due to job-hopping, many people have several bank accounts, and sometimes, there is idle cash lying around in these accounts as well. You would be surprised to know that if you tap into these accounts of both spouses, you might even get enough to cover a couple of months’ expenses.” However, these accounts need to be active and not dormant. To revive a dormant account, you will have to visit the branch.

Unlike those with a job, if you are a freelancer or a consultant, things are going to be hard for you. With work expected to dry up in the gig economy, you need to get into action ASAP. Tarun Birani, Founder and CEO TBNG Capital Advisors says: “Such clients should maintain high cash levels. Currently, we are asking them to maintain six months of expenses due to uncertainty. If need be, they can move out of investments in a hierarchy of low risk to high risk.” Birani says: “Ideally, a loan should be avoided completely. In the worst-case scenario, you will need to do a cost-benefit analysis wherein you have equity investment, but no cash in hand. In a scenario like this, taking a bridge short-term overdraft or loan may work instead of selling equities.”

There’s also an urgent need to cut all unnecessary expenses for at least a few months even after the lockdown is over and things get normal. Adds Rao says: “For freelancers, the work cycle should follow the economic cycle.”

If you have investments and home loan or other equated monthly instalments (EMIs), it could be tough, especially if your salary is delayed/cut or there is a job loss. Nath says: “It is a difficult period. Liquidate your investments partially and pre-pay the loans to reduce the EMI burden. But if one can sustain the EMIs, then one should continue with the loans and investments together. In the next two years, the probability of your investment returns beating the home loan rate of interest is very high.” There’s another option too. Rao says: “Seek an EMI holiday for a couple of months or take an overdraft against fixed deposits or securities which could be used temporarily.”

In short, it’s time to learn a few hard lessons for those who have not been careful with their money. But it’s never too late to start learning.

Did you enjoy this article?

0 people liked this article.

What could we have done to make this article better?

Read Full Article >
Open Your Demat Account Now!
+91 -

Open Your Demat Account Now!
+91 -