When markets fall fast, the phrase ‘to catch a falling knife’ is often used. But when I last looked out of the window I couldn’t see any falling knives.

I once got into a bit of trouble when I mentioned this in someone’s LinkedIn post. They said ‘you are so experienced in markets. You surely understand that the market may fall and when we try to buy the fall, the market may fall further. So it is as dangerous as catching a falling knife’.

But I reiterate, I see no falling knives no matter how closely I scrutinise the horizon.

If your customer is invested in a diversified basket of equities like a UT/ILP/ETF for the long term (10 years and more) then these occasional storms should not bother them as time will reverse whatever is happening today. Clearly there is no falling knife in this scenario.

When markets are down beyond a predefined threshold we will top up the portfolio (buy more). We acknowledge that the market could go down further and that’s why the top up must also be held for the long term. This reduces the risk of loss as across markets the long term holding period generates a positive return. No sharp objects detected here too.