Future looks Bright

We at VRIDHI would like to Wish You all a Very Happy Deepawali. May you make lots of money by next Diwali. You can call us anytime in case you require our assistance.

181106 – In the previous edition of MarketFastFood, it was mentioned that contact your financial adviser as the market looks like bottoming out somewhere in this region. The index level then was 34733, went little more down and is trading today at 35115 as I write this post of MFF. So the market is in a Buy zone or not? We at VRIDHI have started looking seriously at fresh buys but very selectively. We believe that the buying opportunities will be with very selective Stocks and Mutual Funds. You cannot simply go and buy an index or index fund for sure. Hence, taking help of a full-time financial adviser becomes a must.

There are always reasons for the markets to correct or move up. Many people link the movement of the market with the state of the country’s economy. This comparison is absolutely wrong. As Warren Buffet says, Markets in short-term are voting machines and in long-term are weighing machines. The economy may be doing well today but markets can correct steeply due to overvaluations. The economy may be doing bad but markets may do good in the short term. But if you see an average of 5 years, the market would have reflected correctly what the economy did too.

What I am trying to say here is that don’t get carried away with the movement of last few months. Think where will Indian economy be 5 years hence, and what are the signals today? If you are an optimist continue reading, but if you are from the camp that believes nothing is right, even though your own salary being quite fat, then no one can help you. In the market, you need to be grounded, see the real things and don’t have any bias while thinking, and yes always use some bit of common sense too since few missing links can be discovered only with common sense. Market kills a non-optimist!

The GST collections have crossed the 1 Lakh Crore mark last month. It’s a psychological figure for the country but a number of great comforts for analysts like me and the government. The government has been dealing with lower collections since GST was implemented and that was putting pressure of fiscal numbers and in turn on the currency. As the number goes up, these pressures will subside.

Even the corporate India was suffering due to initial confusion and change. The human mind is conditioned to a particular way of working and when you are forced to change there is a lot of resistance. Exactly this thing happened in case of GST too. All these initial hiccups are behind us now, as time progresses people will start appreciating this tax reform except those who are perennially pessimists.

Next look at the PMI numbers. Shows that the economy and its participants are very positive.

The inflation remains under control. Petrol alone is costly which most food products are lower from there 2013 levels. In certain countries, the petrol prices are dirt cheap but the food prices are unaffordable. Few Lakh percentage in inflation! Want to swap the situation? No way!

India continues to rise in the World Bank’s Ease of Doing Business. Looks like we are not far away from the Top 50 club. Just a matter of time. The whole world will notice our country when we are there. A lot of investment and FDI potential will open up further. Just close your eyes and think what can happen if all these come true and looks like the situation will surely come true.

In case you still have confusion, feel free to call us by clicking Contact Us. We have a presence in Chennai, Delhi, Goa and Kanyakumari (Nagercoil). You can reach me very easily for a personal talk.

Not taking much time so that you can continue enjoying Diwali celebrations, keep aside some money every month for the next 9 months and deploy it with discipline. Just be selective on what you are buying. Indian markets are poised to do very well in the next few years and will also be very volatile in the next few months. A roller coaster ride is expected. We will be in a much better situation by next Diwali.

Feel free to call us any time.

Once Again a Very Happy Diwali to you and your Family.

Thanks and Happy Investing

Vivek Karwa

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