KEY EVENTS:
Debt Markets yielding historically low returns now •. US FED tapering (reducing liquidity) will start soon • Equity Market Valuations are definitely stretched by all metrics (PE, PB, Marketcap to GDP) • Global Strategy of China+1 & more
KEY EVENTS:
Indian markets scaled to new all time highs 57k+ • Brent crude prices corrected by 7% • Indian Currency appreciated by 1.86% in Aug, 2021 and more...
Right now there is an unprecedented bull run on the market and investors are scared that there will be a major fallout triggering a market crash. Everyone is looking for a safe haven but don’t want to lose out on a potential increase in the investment base if market defies crash predictions. What should you do?
Equity should only be a part of our investment in a holistic financial plan. During a shock, look at the plan and investments holistically. The entire focus cannot be on the negative return on equity only. It is in fact the right period to start evaluating buys when everyone is selling. Value investing is highly underrated. But with a financial plan and advisor showing you the way, you can remain calm and reap diligent rewards.
Some investors clearly understand the markets so well and ride all the waves and storms and come out winners. Perhaps the only way to understand this is ‘experience’. But what are the steps to gaining this experience. It is tough for a new investor in equities to understand shocking corrections. The article looks at how the cycle of knowledge and experience play out over time for investors.
Returns on debt related investments and FDs are comparatively low and are steady – around 4% to 6% per annum today. But these returns are usually lower than the inflation rate. It is but natural therefore that we want higher returns than FDs and so we invest in other investments such as equities, gold, real estate, etc. The article looks at catches and risks which we must understand clearly and also accept if we want these higher returns.
