The one thing where market consensus is growing is that domestic inflows into equity aren’t going to slow down anytime soon. This growing consensus is emboldening the sell side and the mutual funds industry. The persistent FII selling isn’t doing much to unnerve domestic players. They seem supremely confident. But,…
What should be a good time horizon to judge your investment performance? Should this time horizon be the same irrespective of where we stand in the market cycle? These are questions that are rarely raised or addressed. We almost always conclude without reason that one year is a good time to judge…
Corporate governance is an evolutionary phenomenon in an emerging market like India. We recognize that a statement with strong portent was made. We are seeing several extraordinary situations that test our corporate governance. In the process, we believe that corporate governance will only get strengthened. The extraordinary situation is atypical.…
A five percent crack in the index would not have been on anybody’s mind a week ago. But, investors are spending this weekend wondering if there could be more downside in the coming week. The real story is not in the movement of the indices. The real story lies hidden…
Risk mitigation is an important aspect of investing. Every portfolio should have it innately built in. The composition of the portfolio should factor in the risks and provide for investment actions when risks arise. Not owning too much of an individual stock or fund is one way of mitigating risk. Keeping cash…
Sounding a warning bell to the equity markets is a thankless job. If you are early, you are going to face ridicule as the markets go the other way from your warning. If you are late, you will still be seen as wrong. Bull markets are a contrarian opinionist’s nightmare. Giving opinions…
An interesting week saw a significant divergence in the markets. ITC, a stock that significantly supported the index in its sustained rise suddenly gave way due to flimsy reasons. The stock perceived to have benefited from GST lost said benefit to a rule change. But, GST did not change or…
Markets are hitting new highs every week. But, economic fundamentals don’t seem to support such a prolonged rise. Economic data is definitely mixed. Problems in our economy are on a slow mend. Yet, we see unprecedented buoyancy in our stock markets. IPOs now look like safe lotteries. We have seen…
The bottom up trade in our markets has never had it better. Individual stocks have shown the ability to buck overall market trend and deliver superior returns. Over the past two years, investors’ entire focus has been on finding the right stock that will show a big move. As one…
Every business adapts to change. Businesses without the adaptive strain in their DNA die. Adaptability is the key to survival. A classic all-time great example is WIPRO. When rampant tax evasion in the market by peers elbowed them out of the vegetable oil market, they didn’t blame the system. Nor did they…
Stock valuations have a mind of their own. Most of the time, stocks tend to trade away from what we evaluate as fair value. They either trade below or above what we enumerate as fair value. Mutual funds can never be insulated from the influence of stock valuations. Whether stocks are trading relative…
The index has held steady and only gone higher in 2017. Corrections haven’t even lasted beyond a day or two. But, at the same time, several traditional index movers have tended to be weak. IT and pharma majors have remained weak and every rally in bellwether stocks in these sectors has been sold down. The…