The last week saw a distinct change in the market mood. While the smallcap and SME space decisively cracked, the market seemed more willing to sell. This was a marked shift from its earlier mood when selling was out of question. From only thinking of what to buy next, the…
The Nifty is around new highs. But, we are seeing clear signs of weakness in small-caps, micro-caps and SME stocks. When the market mood is so upbeat, with mutual fund assets at all-time highs, SIP mobilization at historic levels, and folio count at the highest ever, one would expect the…
“Catch them young!”. An evergreen slogan that applies to every aspect of our lives. In investing too, it makes a lot of sense to catch companies when they are very young and to stay the course with them throughout their extended growth phase. To catch a company young, the best…
When the markets stay irrational longer than anyone predicted, it poses a challenge to the investors seeking sanity in the markets. They are at a loss on what to do with existing holdings, where to invest incremental savings, and how to manage asset allocation. Selling one expensive asset class and…
Changing asset allocation is a sure shot way of ensuring risk mitigation in an investor’s portfolio. But if you are already owning a portfolio of equity that you built assiduously, you are posed with a peculiar problem. Should you sell your equity portfolio down as part of your risk mitigation?…
All investors seem to agree that equity valuations are not to their liking. They would prefer to buy when valuations are cheaper. Yet, they don’t want to stay away and are willing to compromise valuations to participate. More interestingly, they seem to be avoiding debt exactly when it is a…
The interim budget was hardly an event. There was hardly much given away as freebies, concessions or incentives to voters on election eve. On the policy and taxation front, the budget assured continuity. Beyond giving the assurance of continuing to work for the poor, farmers, women and youth, the budget…
Investor behaviour in SIP programs is a good indicator of behaviour, expectations, and conviction. If you look at where investors would start a SIP without the slightest hesitation, you will be surprised by how much that choice is driven by recency bias. While every investor knows that applying recency bias…
The rising froth in the PSU space only showcases the extremities of investment behaviour. We are prone to swing to the other extreme when we remain too long at one extreme. This is exactly what we see in the PSU trade. Cut to 2001. We were just recovering from the…
Searching actively for new ideas in a broadly overvalued market does not mean compromising on our investment principles. Active pursuit of investment opportunities is a constant activity for investors, professionals and individuals alike. There is no escaping that activity. But performing that activity responsibly is the duty of every one…
When it is very easy for companies to raise capital, it is also the best time for investors to take out capital. The excessive liquidity sloshing all over a sector or theme makes it possible to both raise capital as well as release capital. What we are seeing in our…
Expectation setting is a very intrinsic part of investing. Setting our expectations correctly prepares us better to face market volatility. This is all the more crucial when we exit a hugely productive year of investing. The natural tendency would be to expect a similar year after a hugely successful one.…