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There has been a huge collapse in the securities market since 2008. What should an investor do?

There has been a huge collapse in the securities market since 2008. What should an investor do?

On February 21, 2022, Russian markets were shaking from the strongest changes in the wake of the political agenda. The stock indexes completely stopped the morning increase, began to fall and ended the day with a general collapse.

 

Given that US traders have a rest on Monday, the main initiators of the fall were local investors and European market participants. Although a certain percentage of sales from American investors was still recorded.

 

Making assumptions about the prospects of the stock market, many experts unanimously assert that the high volatility of indicators will continue for some time. However, there are optimistic forecasts, based on the fact that the development of an armed confrontation between Russia and Ukraine is unlikely.

 

The sharp rise and fall of the market will occur until the political situation changes for the better. Most financiers agree that this is a temporary state of affairs in trading, and in fact, investors are not ready to change their positions. In other words, volatility will accompany Russian assets in the coming days, but the basic state of affairs at this point in time will not change.

 

How can you protect your investments in such circumstances? Financial analysts predict that the situation on the Russian stock exchange may improve during this year.

 

There are several offers:

  • In the atmosphere of a sharp trend jump, you should not try to "catch the bottom" on the decline in the stock market. It is better to invest in US and European stock indices, as their decline is small compared to the Russian market. From the assets of Russian companies in the current situation of unpredictable market movements, it is more correct to choose short OFZ.
  • Raw stocks will at some point be considered more profitable due to the depreciation of the ruble and the overvalued value of raw assets. The pressure will now be felt by the financial, IT-segment and consumer market of Russia “due to the expected economic sanctions and the deplorable pace of development of the technology sector.”
  • There is a possibility of a change in the dynamics towards growth in the long-term forecast, provided that the force option is not implemented. In today's situation, only long-term investors make sense to buy shares. It is worth taking a closer look at the shares of private commercial companies working for export, and bonds, the maturity of which does not exceed 1 year.
  • The main rule is not to use "leverage", as in an environment of increased volatility, this will bring losses. When entering the market, it is more correct to make several entries without investing all the capital. The rapid growth of the market, most likely, will not have to wait.
  • At the next auction, exchange participants should be ready for any situation - both for the continuation of mass sales and for the increase in quotations.

 

20.02.2022
3221
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