For investors on the lookout for long term investment stocks this is just the best time to go shopping.
Over the last few months there have been a lot of negative news in the stock markets like US-China trade wars, a looming USA-Iran crisis in the middle-east, spike in oil prices due to drone attacks in Saudi Arabia, fallout impact of IL&FS saga, default in payments by DHFL affecting lenders, huge sell-off by FPI’s etc. But in spite of all these negatives, if there is one positive thing for the investor, it is the fact that many long term investment stocks are available at attractive valuations.
A perfect quote for the current situation by ace investor Warren Buffet is “If I see a sale in my favorite store, I go and buy some more of the stuff I like’’ - Warren Buffett.
What we can infer from the above quote by Warren Buffet is that every market correction presents a buying opportunity in long term investment stocks. During market corrections, panic stricken investors sell like crazy to salvage whatever is left of their portfolio as if there is no tomorrow. On the other hand, wise investors go shopping for long term investment stocks.
To understand why the current market correction offers a good opportunity to accumulate good long term investment stocks let’s look at the past history of stock markets as to how they have recovered each time after market corrections.
Any market correction is actually an opportunity in disguise. It is upto the investor to decide whether he wants to capitalize on the opportunity to invest in long term investment stocks at bargain prices or be fearful and lose the opportunity. History has proven again and again that some of the best investments have occurred during market correction.
Market Sentiments Are Improving
Investors should also remember that the current market correction is just a temporary phase and lot of corrective measures are happening and already implemented.
Discussions over US-China trade wars have shown some progress, tensions between Iran and USA have subsided a bit with American president Donald Trump mellowing down his stance a bit. The rollback of the FPI surcharge in India and reduction in corporate tax are some positive measures which have been cheered by both domestic and foreign investors.
India’s Long Term Growth Story Will Boost Long Term Investment Stocks
Irrespective of the negative sentiments in the stock markets currently, India’s long term growth story remains largely intact. As Indian economy takes transforms from the current 2.6 trillion USD to 5 trillion USD over the next five to six years, many businesses which will support India’s growth story will also grow. And when businesses grow and reach their true potential, it will also reflect in their share prices.