Rising Retail Participation: Equity Culture Is Here To Stay

I know most of you must be wanting to hear from me on “Which direction will markets take from here on”? Before I even talk about where we are headed, do remember I had said that the market, i.e Sensex may not fall below 31000 even when most of the analyst on the street predicted a downfall. 

Markets have a tendency to correct and any correction is healthy for the markets. Such bouts of corrections are to be used optimally and it is indeed in situations like these that a savvy investor accumulates and makes fresh purchases.

What we have with us is a difficult geopolitical situation to deal with and a slowing GDP growth. Must say these are two big walls of worries that markets have to scale. On the positive side, we have abundant liquidity and an ever-growing emerging investor class in the form of retail investors. Retail investors are participating in equity markets like never before. Can say that the equity culture is finally here to stay in India. 

In this issue, we thought we will celebrate the performance of small-cap stocks. Indeed small-cap investing is becoming popular with the masses and there are multiple options available for the investors to invest in quality small-cap stocks, mutual funds investing in small-caps being one of the popular options. We bring to you fresh views from market experts on small-cap stocks and why they think small-cap investing will be a huge rewarding experience. 

Investors should focus on quality small-caps with less amount of debt on the books and pay attention to the qualitative aspects such as management quality and corporate governance. Money will be made in small-caps, we have no doubt and you should also have no doubts as well, on the potential of small-caps. In this issue, we have come up with a fresh set of small-cap stocks as recommendations. 

Derivatives market is another area which is gaining popularity and we are carrying an article on ‘Best derivatives trading practices’ for the benefit of readers. 

There are no major triggers for the markets, however, markets will start discounting earnings for coming quarters and market participants will react to the inflation data and start discounting interest rate cut scenarios as well. May be there will be at least one small rate cut before the budget session even as the policy makers struggle to put Indian economy on a faster growth trajectory. 

Someone rightly said that “India is like a house that is undergoing renovation”. We will have a betterlooking India in 6 to 9 months from now. With better economic prospects, the stock markets can only take one direction, that is, upwards. Till that time markets may trade rangebound with a positive bias. 

Stay invested and invest in a staggered manner.