They have morphed into 'global' owing to the heavy investment from foreign institutional investors (FIIs) and dependence on the developed world.

What kind of impact has the global crisis had on investors here?

Fund managers across the globe are moving out of impulsive investments and wandering towards less risky assets. In a state of panic, FIIs and other investors pulled out their money from the stock markets making it choppy. As financial managers migrated from gold to cash, the volatility of the yellow metal went up.

In essence, the impact of a weak global economy is volatile markets and lower stock prices. High inflation and slowdown in economic activity are currently plaguing the domestic shores.

Where does an investor park his funds in the current conditions?
Stock markets:

Analysts opine the markets have hit the bottom and good days are ahead. Do not attempt to time the markets. Invest with a long-term perspective of 5-7 years. This is the best strategy in unpredictable market conditions. Investors can rebalance their portfolios now. Weed out the laggards and add fundamentally - solid stocks to your basket.

A long-term approach enables you to view the phase of a slowdown as an opportunity to pick up stocks at low valuations, rather than hitting the panic button.

Debt avenues:
The reigning high interest rates have made debt instruments popular with small investors. There are lucrative returns from low-risk fixed depositsand increased yields from debt funds. The returns from debt funds are poised to improve further in the days ahead.

Fixed maturity plans (FMPs) that are for fixed time periods invest in fixed returns investments such as government bonds and money market instruments. Exposure to FMPs is not a bad idea for the risk-averse.