Hunt For Opportunities In Broader Markets For Outperformance!

Markets are doing what is expected of them before a major event (budget announcement) – trading volatile and sideways. While budget will be the next trigger for the markets, major announcements by the European Central Bank (ECB) and the US Fed are expected to influence the market moods. The hope of rate cut and a resolution of the trade war issues between the US and China could propel the global equity prices higher. It is true that Trump has announced imposition of further tariffs on Chinese goods but, in long run, such steps could prove to be suicidal for the US economy. Due to such myopic decisions, the US economy may witness higher consumer prices, higher raw material prices and the corporate profit margins may decline making them less competitive. Several business houses in the US are pleading with the US government to not go ahead with further tariffs as it could be an economic hara-kiri. So, on the trade war issue front, the worst may be over for the global equities.


The cash crunch back home seems to be a major issue right now which I believe will be addressed in the coming quarters. There will be no quick solution and investors must realise that it takes time to come out of such financial quagmire. The temporary slump in economic growth suggests that the revival in earnings growth will take some more time. May be for the next quarter or two, we will see flattish kind of growth in earnings. All eyes will be on the steps taken by Modi 2.0 to inject growth stimulus in the economy.

At any given point of time, there are multiple investment opportunities in the markets. However, when you look deeper, you will find maximum number of opportunities exist in the small-cap space. In our cover study, we have shared with you our outlook on small-cap stocks and why one should take small-cap investing seriously. Also, what might excite you is the list of small-cap stocks that includes ranking of small-caps based on market capitalisation, sales, profitability and dividends. I hope investors like you will make the most of it.

Also, in this special issue, we have covered small & medium enterprise (SME) listed space extensively. In the special report on SME sector, we have discussed the challenges faced by the MSMEs and the opportunities that exit for the growth-hungry small companies. For market-savvy investors and for those who have a higher risk appetite, the SME listed space presents a lucrative opportunity. Me and my team at Dalal Street Investment Journal is extremely excited to share with you a list of top 50 SMEs listed on the BSE SME and NSE Emerge platforms. The ranking shared in the special report is based on market capitalisation, sales and profitability of the SME companies. Again, I hope the capitalist in you will make the best use of the list of top 50 SME stocks shared with you.

In a scenario where the key benchmark index is close to an all-time high with stretched valuation and the broader markets are expected to do well in the coming years, all an individual investor needs to do is to act consistently as an investor and not as a speculator. Sticking to the core investment strategy is always advisable, but there should be enough room in the core strategy to accommodate tactical changes that facilitate capturing the broader market trend opportunistically. In my view, the broader markets are in for some impressive performance in the coming years. Caution is always advised while seeking opportunities in the broader markets, however, know for sure you are seeking opportunities in the right space. Research will be the key to your success.

Research leads to confidence which, in turn, leads to right decision making.

Happy Investing!