Why March showed that you need to keep investing in ASX shares

I think that March 2020 showed that you need to keep investing in ASX shares even during share market panics.

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Clock showing time to buy, ASX 200 shares

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I think that March 2020 was a perfect example of why you need to keep investing in ASX shares.

The selloff of the share market was one of the worst in history, in such a short amount of time. The S&P/ASX 200 Index (ASX: XJO) dropped over 36% from the peak in February to the low in March.

On 23 March 2020 it would have been easy to think that the share market would just keep falling and falling. The effects of the coronavirus are unprecedented. Unemployment and lots of other economic measures don’t look good and will get worse.

Why you should keep investing in ASX shares

No-one can know what the share market is going to do. And it can be unwise to bet against the share market for long periods of time. Over the decades the share market has kept going higher and higher.

I decided to keep investing in ASX shares as the market fell. I even managed to invest a little at the bottom. But since that bottom the ASX 200 has gone up over 20%.

Will we get another opportunity as good as 23 March 2020? Maybe, maybe not. But will you be brave enough to invest if the market falls again? If you don’t act you won’t be able to benefit. We just don’t know when the markets will hit a bottom.

The worst point for the share market will come much sooner than the worst point for the economy. You could miss the bottom if you don’t keep investing in ASX shares. We may have already seen the worst of it thanks to all of the central bank and government support.

We may already have seen the lowest price for shares like Woodside Petroleum Limited (ASX: WPL), Crown Resorts Ltd (ASX: CWN), Sydney Airport Holdings Pty Ltd (ASX: SYD) and Challenger Ltd (ASX: CGF).

Foolish takeaway

It’s okay to keep a bit of dry powder in reserve, but you could miss the best investment opportunities if you just sit on the sidelines for the entire period with your entire investing cash balance. I’ve been putting money to work and I think you should keep investing in ASX shares if you can.

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*Returns as of May 24th 2021

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Challenger Limited, Crown Resorts Limited, and Sydney Airport Holdings Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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