Best Investing Lessons from the Pandemic – A Great Opportunity to Investors

Coronavirus, spread across the world and considering as the most pandemic situation in the century. “Of course”, it is a highly panic situation and people across the world are living in fear.

Not only the most powerful economies like US, Britain, Germany, France but almost all the countries, irrespective of developed, developing or under developed, declared long time lock down and going through an economy slowdown. This action impacted the stock markets to a great extend by dragging the value of almost all the stocks to the bottom level. It also taught the investors about investing lessons from the pandemic

Pandemic Effect to the Stock Markets Worldwide

No doubt it is a clear macro effect.

Read the article “Micro and Macro Factors: What Every Stock Investor Must Know” to know more about how macro and micro factors to be identified and take investing decision upon that.

Fundamentals of great companies are still strong enough and undoubtedly can say that the current developments are happening only due to the pandemic fear.

Stock market investors across the world  are also panic and thus huge selling were happening. Because of over selling activities, stock markets dragged down to the bottom level.

But as a stock market investor,  we should not forget that we are getting an excellent opportunity to expand our investment portfolio by adding the stocks of great companies!

“Yes, it is a golden investment opportunity”, widely opened its doors to the investors worldwide to find and invest in the best businesses of great companies.

Interestingly, if anyone miss such very rare opportunity, may needs to wait for years to get such beautiful opportunity to come again

What an Investor Should Do Now? And, what are the investing lessons from the pandemic to the investors?

Individual investors now have lots of free time due to lock down. Thus, most of them are in home and having enough time to do necessary home work to find best businesses in their country to analyse and invest.

There are lots of ways to identify the best stocks. One of the simple method is, going through the prominent article I have posted earlier in this blog.

Refer the article “Personal Framework For Investing – Discussing Methods To Select And Invest On Great Companies“. This will help investors to know the important areas to focus to find and select the best companies to invest.

Method of Investing

In coming days, the stock markets are expected to drag more and more to the bottom level.

As an investor it is the time to identify the best companies, list the best companies one by one and monitor the movements in a daily basis.

Once you are confident about the business and found the stock is available in a cheap price, then invest on that without rethinking.

Ensure you are investing a considerable amount to the best stocks to leverage maximum profits from the forthcoming boom.

Investing small amounts to multiple stocks will not work better, but investing considerable amount to few great stocks will certainly bring your fortune. This is the most important investing lessons from the pandemic, I have learned.

Great Stocks, Like a Balloon Filled with Hydrogen and Pulled Down Forcefully

“Businesses that having monopolistic position in the markets are the best to invest for long time.”

In every country such companies are existing in the stock market for investors. Stock prices of most of these companies and across the world are currently available cheaply for investors to buy.

“These stocks can be compared to a balloon filled with hydrogen and which had forcefully pulled down due to a temporary reason. Once get free, it will start flying to unpredictable heights within no time. Which means, once the coronavirus issues get resolved or any trustworthy information about the coronavirus control, prices of such fantastic stocks will boom to heights like a balloon and within no time.”

Thus, within next one or two years, invested money in these stocks would grow as double, triple or more times.

Why the Value of Great Stocks are Down?

You may thinking that why the stock value of good stocks also coming down along with others?

“Yes”.

As I informed earlier, it is just a macro effect which means investors are panic to buy, but everyone is selling stocks in the market and that is the reason the prices of such stocks are also coming down tremendously as part of the rally.

It is a temporary momentum as these companies do not have any issues with its business or fundamentals, but just moving down along with the peers in the stock market.

Remember the words of legend investor Warren Buffet “Fearful when others are greedy and greedy when others are fearful.”

This statement is somewhat of a contrarian view on stock markets and relates directly to the price of an asset.

When others are greedy, prices typically boil over, and one should be cautious lest they overpay for an asset that subsequently leads to anemic returns. When others are fearful, it may present a good value buying opportunity.

*** These are the investing lessons from the pandemic I have learned from the pandemic situation.