RECESSION PHASE –

SUGGEST DO’S AND DON’TS TO

AN INVESTOR WITH AN EXAMPLE
 GROUP NO. 6

 MEMBERS:  ROLL NO.

 NOORJAHA KHAN  PG (B&F) 21

 GANESH MADANKAR  PG (B&F) 25
 PURVA PARAB  PG (B&F) 33
 KARINA SHAIKH  PG (B&F) 39
 PRIYANKA SINGH  PG (B&F) 42
 SAKSHI VICHARE  PG (B&F) 44
 SALONI VICHARE  PG (B&F) 45
 SUMEET GHOSALKAR  PG (B&F) 52
 BUSINESS CYCLE

 WAVE LIKE FLUCTUATIONS OF BUSINESS

ACTIVITY.

 RECURRING PHASE OF EXPANSION AND

CONTRACTION.
 BUSINESS CYCLE - PHASE

 BOOM / EXPANSION
 RECESSION
 DEPRESSION
 TROUGH
 RECOVERY
 RECESSION PHASE

 THE STAGE FOLLLOWING THE PEAK PHASE.

 DEAMND FOR GOODS AND SERVICES STARTS DECLINING.

 EXCESS SUPPLY IN MARKET.

 PRICES TEND TO FALL.

 REASON FOR RECESSION PHASE

 Profit inflation and over optimism which increase the tempo, carry with them
seeds of self destruction.

 In view, of high profits, entrepreneurs invest more, but there is scarcity of

resources.

 Over optimism pave the way to over pessimism.

 INDICATORS OF A RECESSION

 Negative Real GDP.

 Decline in Income.

 Trade deficits.

 Rate of unemployment.
 EFFECTS OF RECESSION
 Unemployment rate increases.

 Reduce consumption rates.

 Inflation rate goes down.

 Reduce Corporate profits.

 Vicious cycle of an economic slowdown.

 DO’S & DON’TS TO AN INVESTOR.
 • WHAT SHOULD AN INVESTOR DO
DURING RECESSION?

 1. SEEK OUT CORE SECTOR STOCKS:

When rest of the economy is on the

shaky ground, there are often a handful of sectors
that continue to provide steady returns.

Eg. Healthcare sector, Utilities, Consumer goods

sector.
 2. FOCUS ON RELIABLE DIVIDEND
STOCKS:-

Great way to generate passive

income. Better to invest in companies with
low debt equity ratios.

Eg. Hindustan Petroleum Corporation

Limited, Coal India Ltd, SJVN Ltd, etc.
 3. CONSIDER BUYING REAL ESTATE:-

When home values drop due to recession

it creates buying opportunity for investments
properties once values start to rise again one
can sell at profit.
 4. PURCHASE PRECIOUS METAL
INVESTMENTS:-

Precious metals, like gold, silver

tend to perform well during market slowdown.
Demand for these commodities often increases
during recession.

Eg. Buying coins / bars from seller, Gold ETF ,

etc.
• DON’TS TO AN INVESTOR DURING RECESSION

 1. DON’T SELL YOUR ASSETS

IMMEDIATELY:-

Many people panic and start

selling their stocks and assets at very first sign of
recession which is not advisable.
 2. DON’T FOLLOW TRENDS FROM
PREVIOUS RECESSION:-

No two recession are the

same . Investors must always discuss such trends
with a financial advisor.
 3. DON’T MAKE DRASTIC DECISION:-

Sometimes it is better to ride out

the storm and wait for the market to stabilize or
recover before making significant financial
decisions.
 4. DON’T IGNORE YOUR PORFOLIO:-

It’s perfect time to review your

portfolio to make sure you have sufficient
diversity and are investing ventures that
provide long growth.
THANK YOU