Stock Markets: Highly Volatile
By Ashwini Agarwal
First publised on 2022-02-15 11:23:09
About the Author
The volatility in the stock markets reached the peak on Monday and Tuesday this week. On Monday, stock markets crashed to a 10-month low as investors jittery over the worsening border situation in Ukraine and the imminent hardening of interest rates in the US sold on a huge scale to bring down the Sensex by 1745 points. Investor wealth close to Rs 13 lakh crore was wiped out in a single day. But what happened on Tuesday was the total opposite. Sensex jumped by 1736 points to recoup most of the losses (although individual shares might have lagged). Buyers returned with a vengeance as reports confirmed that some Russian troops had started leaving border posts to return to the barracks. Some equities were also found to be lucrative at lower levels post the Monday slide. Further, reports of India signing a free trade agreement with the UAE also improved sentiment.
But this kind of volatility is injurious for the ordinary investors who get confused by the daily flip-flop. They cannot build a strategy and a solid portfolio. It is the informed and full-time day traders and big market operators who benefit in such a volatile market. Since global cues are not favourable and changing rapidly daily, small investors will be well advised to do a careful research before making investments. Even most of the recent IPOs have slid down close to their issue price, with Paytm sliding to less than half the issue price. Such a market scenario is not for the casual investor as he or she is more likely to lose money. They should wait till the markets become stable.
