What to do in a Stock Market Crash?

A sudden dramatic decline of stock prices across a significant section of a stock market, resulting in a substantial loss of wealth, is known as a stock market crash.

Stock market crashes occur for many reasons, but the most significant one is panic selling due to predictions of an expected outcome due to current situations.

It is a social phenomenon that gets in effect due to crowd psychology. When a certain amount of people start selling, it creates panic and more people starts selling, which in turn creates more panic and more selling comes into play.

How do we deal with a stock market crash?

• The first and foremost way to deal with a market crash is to stay calm. Try not to panic because when such a situation occurs, it is mainly driven by panic.
• If you’re a long-term investor, do nothing at all. Stock market crashes are temporary, and after a few days/weeks of downfall, the stock market is bound to stabilise. Most influential stock market investors talk about how you shouldn’t panic during a stock market crash and rather wait and be patient.
• Acceptance is such a critical practice in our everyday lives and when you’re a stock market investor. We all make mistakes, and we all learn through these mistakes. Do not give up after a setback that you can always pick back up from. Take this setback in the best way possible and find better ways to invest during a crash market through your experience.
• Always have a stop loss according to your profile of investing to be sure that you’re alive in the market and do not come across such a hit where there is significant loss of capital.

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