The heightened volatility in our markets seems unrelenting. Fear is pervasive. Every rally is getting sold. Markets are nervously scanning global indices all the time in anticipation of more bad news.
While Coronavirus seems to have been contained in China, it is wreaking havoc in the western world. India is still assessing how far and deep the virus has spread. Economic activity is at a standstill. We are now in a lockdown with no visible return to normalcy.
The markets remain open, in the name of transparency and public confidence. Investors are likely to get more irrational as the lockdown extends, the extent of damage is discovered, and the economy stays shut. Markets will only regain their sanity when they see signs of the lockdown being lifted. Global flows due to fears will slowly settle, as investors start scouting for newer opportunities in the post Coronavirus world.
Indian markets will remain volatile, investor behaviour will grow increasingly volatile and valuations will become even more attractive. Investing for a post Coronavirus world can wait for it to end. Or, we can begin our investing in the worst of times and complete it by the time we conquer Coronavirus.
The rewards for conviction will always be higher depending on when we show it. This time will be no different.