All one has to do is to identify one’s goals and a time horizon to achieve them.ĭo you think earnings is likely to bounce back in double digits in FY19? However, goal-based investing is more scientific and works best when combined with a dynamic portfolio strategy. What should be the portfolio composition of investors in the coming financial year assuming he is in the age bracket of 35-40 years?ġ00 minus age rule is the simplest way to determine asset allocation but it does not consider a lot of important factors like risk profile, personal liabilities etc.įor example, based on the same principle, a 40-year-old investor should invest 60 percent in equity and 40 percent in debt. We continue to believe that a bottom up approach is warranted in building one’s portfolio.
Irrespective of the market cap of a company, as long as there is a disconnect between actual earnings and valuations, there would be upgrades or downgrades in a stock. Hence, as long as one continues to hold good fundamental stocks in growth sectors and run by a top class management, an investor would continue to get large benefits from the Indian growth story.ĭo you think the uptrend for mid & smallcaps will continue in the next financial year? If yes, why?Īs mentioned earlier too, returns that an investor makes in the market are purely based on the quality of stock that one holds in one’s portfolio. We tend to believe that the Indian capital markets have managed to give a CAGR return of 14 percent over the last two decades, irrespective of events like elections, scams, wars, droughts, floods, etc. infrastructure led public capex spendingĭo you see Modi returning to power in 2019 and how are markets likely to react? Which sectors are likely to hog the limelight in the coming financial year and why?Sectors and themes that we like for the next FY include stocks positively affected byĢ. Multiple events would bring about heightened levels of volatility. The general markets would tend to gyrate between a broad range of 9800-10600 on the Nifty. We believe that it would be very difficult for the benchmarks to make new highs anytime soon. What is your index target for the financial year 2019? Do you think the index will be able to reclaim 12000 on Nifty? However, as long as the earnings growth revival that the market is displaying for the last two quarters continue, there would be substantial returns that the Indian markets would deliver over the long run. In the short run, there will be a lot of noise which could spook the market.
PRASANTH PRABHAKARAN SERIES