The purpose of monetary policy is to manage inflation, facilitate growth, and regulate credit in the economy. The RBI’s Monetary Policy Committee (MPC) has a clear mandate to target inflation and maintain it around 4%. In terms of bond markets, 2017 and 2018 are like chalk and cheese. 2017 witnessed…
At a time when everybody has overdosed on equity, elections are looking imminent, macros are getting challenging, and benchmarks are outperforming portfolios, it makes sense to take a re-look at asset allocation. Clearly, the most important thing now is to get our asset allocation right. A wrong allocation can affect…
The genesis for the current meltdown in Indian markets must be understood well and remembered for a long time to come. Interestingly, the indices held steady during this period. So, what caused this downslide? Broadly, the markets showed overwhelming faith in smaller companies over the index bellwethers between 2015 and…
Market cycles tend to constantly throw challenges at investors. When markets are at cyclical highs, it is extremely difficult to sell and exit. When markets trade near cyclical lows, taking a bold investment call is near impossible. When the markets trade on an uptrend, we tend to keep buying more…
The sharp comeback in pharma stocks, the buyback announcement by TCS, and the sustained weakness in midcaps send out clear signals. The markets are at the crossroads. Liquidity and its power to sustain equity valuations have been overestimated. You may wonder why this is happening. As a performance hugging universe,…
Podcast Transcript: My stance on mid-cap funds has been bearish in a while. After the dream run between 2013 and 2017, I started to feel very uneasy about them from September 2017. I had been advising clients to invest in the very funds when the valuations were softer and definitely…
Participation in equity markets is viewed as a secular trend. Being invested is not the same thing as being invested in the right place. Even within the equity market, where you are invested matters. For instance, one could still have been fully invested in equity markets without owning a single…
The week was eventful and that is putting it mildly. Globally, we saw the Iran deal getting called off by the US. Oil prices predictably spiked. Several domestic banks reported their worst numbers in recent history. Provisioning norms enforced by the RBI seem to have taken a toll. The political…
Interest rates are a great leveller. They always set the trends of the equity markets. But we have two sets of rates to contend with, domestic and global rates. Domestic interest rate trends are constantly shifting and puzzling. Just when the trend seems set to rise, something happens which softens…
