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Is it time for a plan B with ASX 200 shares?

It was a tough day on Monday for ASX 200 shares as the S&P/ASX 200 Index (ASX: XJO) slumped 1.51% lower to 5,815.0 points.

There were broad-based losses across the market with ASX travel, financial and energy shares hit hard.

This came as investors begin to fear the growing number of coronavirus cases in the United States. I think the market is trying to price in the economic impact of any potential shutdowns or further restrictions around the world.

So, with a number of ASX 200 shares slumping lower in yesterday’s trade, is it time for a plan B?

Is it time to buy, hold or sell ASX 200 shares?

It’s easy to see a sharp market fall as a warning sign of what’s to come. That’s even more so the case coming off one of the steepest bear markets in history back in March.

However, I personally don’t think it’s time for a plan B with ASX 200 shares. The buy and hold strategy has worked wonders for many investors over a number of decades.

I don’t see why this time around should be any different. That means that panic buying and selling shares could do more harm than good once you account for taxes and transaction costs.

At most, I could look to position my portfolio more defensively. That could mean buying ASX 200 gold shares like Evolution Mining Ltd (ASX: EVN) or companies with non-cyclical earnings like Coles Group Ltd (ASX: COL).

However, I don’t think the middle of a pandemic is a great time to change my investment strategy. Given I’m investing for 30-odd years into the future, what happens today really shouldn’t worry me.

Of course, that’s easier said than done when watching ASX 200 shares plummet lower. However, there are still pockets of the ASX that are performing strongly including retailers like JB Hi-Fi Limited (ASX: JBH).

Foolish takeaway

Rather than panic in the face of a volatile market, I prefer to consider it a buying opportunity. Large ASX 200 share price movements can mean prices are dislocated from reality – and it could be time to snap up a bargain.

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Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET. 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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