MD of PRIME SECURITIES N JAYAKUMAR had a special conversation on the completion of 20 years of CNBC Awaaz. He told that in 1987 the market fell by 23% in a single day. In the last 44 years, investors in the US have seen all the crises. Let us give you information about the whole matter. What happened that day? Why did Black Monday become famous from that day? What should be done in the market now?

What happened on Black Monday...how did it get its name and why? The reason for the crash of the US stock market in 1987 was not one but several news reports that came together. The market fell by 22.6 percent in that one day.

That is why it is known as "Black Monday" and this incident happened on 19 October 1987. On that day, the Dow Jones Industrial Average (DJIA) fell by 22.6%, which is the biggest one-day fall till date. What happened on Black Monday? (1) Program Trading - At that time, the use of computerized program trading in the stock market was increasing rapidly. As soon as the market started falling, these computer programs started selling shares in large quantities automatically, which accelerated the decline. (2) Valuation of the stock market - Between 1982 and 1987, a huge boom was seen in the stock market, in which the Dow Jones Index increased by 250%. Investors considered it a "bubble" and when the market started to fall a little, they panicked and started selling off. (3) Dollar weakness and trade deficit- In 1987, the US dollar was weakening and the trade deficit was increasing. This forced investors to doubt the economic stability of the US. (4) Interest rate hike- The Federal Reserve had raised interest rates in 1987, making the bond market more attractive. Investors started selling stocks to buy bonds, causing the market to fall. (5) Global market- The market crash of 1987 was not limited to the US only. As soon as the sell-off started in the US, it spread to the markets of other countries as well. Hong Kong, UK, and other European markets also saw a huge decline. (6) Panic and market psychology- As soon as the market started to fall, panic spread among investors. Many investors panicked and started selling their shares simultaneously, which led to further decline in the market. N JAYAKUMAR says that in 1987 the market fell by 23% in a single day. In the last 44 years, investors in the US have seen all the crises. But investors should not panic. 20% of the money can be used for trading. Up to 80% investment should be continued through SIP. It is important to continue investing in the market. Investing in the market at the right time is a big task. Investors should maintain investment in SIP and MFs, trade with only 20% of the amount.