How am I reading the situation?

I have been expecting volatility in the markets. In the last 6-8 months, i have been advising to be cautious with our asset allocations while i am keeping a razor sharp focus on improving the overall quality & risk-reward of our investment portfolio.

Markets are never static and always have a significant emotional quotient. I understand that and try to navigate risk and returns continuously across the continuum of the cap curves and sectors available. 

Young investors entering the equity markets for the first time also heightened the bullishness in the market. 

Mutual funds have been asked to monitor the liquidity profile of their portfolios carefully and come up with strategies to counter sudden liquidity

issues that may arise.

Macro backdrop for corporate India has never been more favourable. With India’s fiscal deficit and current account deficit under check, capital

costs continue to remain benign.

Corporate India has a good balance sheet and with the Make in India campaign, we are witnessing a recovery

in manufacturing, which favours midcaps and small caps more as they tend to supply global vendors from here. 

Multiple indicators were endorsing the fact that from a medium-to-long-term perspective, value stocks, which had so far traded in the neglected territory, will now be market outperformers in absolute as well as relative terms. any further up move and this outperformance would eventually signify preference for value stocks. According to my reading multiple indicators are now pointing to an amplification of the value thesis at a much larger scale as we are at an inflexion point. I am now seeing that the stocks in admired territory are undergoing a correction, while stocks in neglected territory are seeing a rise in valuations.

My understanding is emphasizing that this trend will perpetuate going forward.

I would like to

⇨ Add more to the investments during corrections as it helps in higher returns, when market (/ Portfolio) recovers.

⇨ During corrections, instead of Timing the Low, which is near impossible, plan your investments in a staggered manner for certain %-age of correction.

⇨ Keep a SIP … it really helps in building your goal-kitty and wealth over years.

⇨ Asset allocation plays a vital role in the larger scheme of things.

⇨ Rebalance the allocation in times of need (like a sharp rally in equities, deep correction in markets, other assets, etc).

Please call me for detailed discussion and investment opportunities.

*Views are personal & not for any recommendation/endorsement.*

Happy investing!!

Regards,

Ritesh Sheth CWM®

(Chartered Wealth Manager)

Amfi registered Mutual fund distributor under ARN-0209 EUIN- E030691.

ARN Date of initial registration - 16-AUG-2002

Current validity of ARN upto - 01-10-2029

*Mutual fund Investments are subject to market risk please read the offer documents before investing.*