Stock market crash – Heavy decline continues in the small-cap and mid-cap of the Indian stock market. In such a situation, many retailers are worried and their portfolio has seen a decline of 10%-15%. Recently the presence of retailers in the Indian stock market has increased significantly and most of such investors are new. And it is becoming difficult for them to understand this decline.
Which part is crashing?
The decline in the stock market is happening only in the mid-cap and small-cap segments. There is no big decline in the large-cap segment. Large caps are running around life highs.
Crash Reasons?
From April 2023 to February 2024, a tremendous surge was seen in the small-cap mid-cap segment. It is believed that decline is often seen in the month of March due to profit booking.
What you should learn from this Crash?
- Avoid buying too many quantities of one share at once. Buy in pieces. For example, if you are thinking of buying X shares, first fix the amount of that X shares. For example, if you want to buy shares worth one lakh, buy 25% i.e. shares worth Rs. 25,000 and see whether you are right or wrong.
- Never be in a hurry to buy shares, wait comfortably and buy only when you feel comfortable.
- Before buying shares of any company, check the holdings of its promoters. Set the criteria that if the promoters’ holding is less than 70% then I will not buy. The advantage of this will be that when the market crashes, the shares held by more promoters fall less, because retailers have less percentage so their selling does not make much difference.
- Before buying any share, check its price data for at least 1 year, and confirm whether the share has moved much if it has moved then for what reason. A highly run-up stock can be quite harmful.
- After buying any share, decide the range of its profit booking, like if you have bought shares worth Rs 1 lakh then you should do profit booking of 5%-10% or whatever you like.
Disclaimer – We are not a registered firm. We are sharing our views only and do not recommend any type of buy-sell in the stock market.