Roller Coaster Ride Ahead

190127 – Volatility has set in as expected. Again, like before, the same is invisible in the indexes, but when you dig deep into the market you find that enough damage has been done in the past 10 days. There was some recovery which tried coming in, and some of that has again been taken off. Justified! The market climbing by the stairs would be better, an investor should not expect an escalator type of recovery, that’s always dangerous.

We at VRIDHI have been trying to stay connected with you all on various platforms, would like to mention a few of them before proceeding, would request you to join them all.

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Now coming back to the markets:

I, still feel we would do better in 2019 than 2018. Leave the minor blips, I guess, in the previous post I had mentioned that my gut feeling says we may hit a new high before the Lok Sabha elections. Some people sent me counters, people don’t understand! I am in competition with none, and nor do I predict this short term. It’s just a gut feeling which may turn out to be real or may fail. If it fails, so be it.

Some people have been sending me WhatsApp messages and Facebook messages that America may crash and take India along with it. The scenario is totally different. Dow Jones on 3/12/2018 hit a high of 25980, it saw a steep correction and hit a low of 21712 on 26/12/2018, that’s 16% correction in a short span of time. The latest high on Dow is 24750 achieved on 18/1/2019 which again is a massive recovery in short span of time.

We did not move with Dow! India is adjusting to her own scenario.

What’s the lesson? We have to move very selectively for the next few months. The fact of the matter is that the valuations are cheaper now, and yet I am not able to freeze on the investment ideas easily. Meaning, a normal investors life would be much more difficult. We at VRIDHI will keep doing the hard work on behalf of you. Just stay connected with us. In the previous post, I had recommended three ideas, and all of them are stable even today. Read them by Clicking Here.

Also in the previous post to the previous, I had mentioned that we had recommended MGL to MarketFastFood clients and you know what? The stock is still stable. Don’t take this as a Buy recommendation since we may exit without any info. The exit ideas for the other three stocks will be posted on any of the above-mentioned platforms, hence stay connected.

India is adjusting to her own scenario. The market is factoring in all the possible outcomes of the elections. Don’t go with the doomsday sayers. Ignore them. Most of them have stopped getting their easy money and are predicting hell. Take my word, India is the best investment case in the world today. With China slowing down and US-China stress, India will fear in short term but gain in medium to long term.

So, be selective, take advice from your advisor, use strategies wherever possible and keep adding fresh money in these volatile times.

If you are a member in any WhatsApp group and would like me to contribute, feel free to add 93810-24365. No one to one messages, please.

At your service

Vivek Karwa

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Better 2019

190101 – Wishing you all a Very Happy Calendar New Year 2019 and may all the days till next year are exciting, profitable and memorable. I, in my video recently had promised to mention few investment ideas in the article and will do so today. To stay connected with us on all social media platforms Click Here.

I know most of you must be busy on this day and hence will not make this post very long. I promise you will be able to read the whole write-up in under 11 minutes. Not all are sitting in office today like me. 😦

In the video, I had mentioned a line that ‘My gut feeling says we may hit a new high before Lok Sabha elections’ Not necessary the gut feeling is high but most probably 2019 will be better than 2018.

Look at the Index performances in 2018:

Index 29-12-17 31-12-18 Change %tage

Sensex

34057 36038 +2011 5.90%

BSE MidCap

7781 6696 -1085 (13.94%)

BSE SmallCap

19231 14707 -4524 (23.52%)

The Sensex delivered marginal 6% returns. Still, not all investors made it, why? Because the movement was based on just 5 companies. The silver lining is that world markets did much worse. India was among top performers with this bad return. The movement was very shallow. MidCap Index delivered pretty bad and SmallCap Index was a disaster! When Index itself is down this much, no wonder most investors are seeing their portfolios in deep red.

This builds the base for a better the year 2019, in spite of elections around the corner. You can read the previous two posts to read the views on elections.

Volatility will still be seen and hence I would publicly mention ideas which may not see huge volatility. MarketFastFood clients get updates instantly but the public at large who are acting upon reading this post should go safer. Any further update would be posted in the comments box by me in future.

Things are improving constantly, as per RBI’s Stress Test of the banks, the PSU banks are getting stronger. Buy SBI at CMP of around 295 and hold it till I update again.

The loans which were written off from the balance sheet are now finding their way in again with NPA resolution mechanism. Some people got misguided when politicians said loans are being waived off of the rich, there is a big difference between waived off and written off.

The GST has almost settled fully. With the liquidity situation improving in the system and elections around the corner, the rural economy may do well. Elections see a lot of spends and hence the economy benefits. GST will be a game changer and stocks like ITC in the FMCG sector can possibly do well. You can Buy it at this CMP of around 281 and just hold on for some time. Compared to other peer group companies the stock looks cheap as well.

The third stock I would like to choose at this juncture is Cipla at CMP of around 521. You can aim for a price of 600+ and then ask me again what to do.

In the recent Fb Live video, I had said that don’t get misguided by what news you see on social media. It’s a platform right now used by vested interests to spread fake news about the economy. What has been said in MFF articles till now have gone the right majority of the times.

We at VRIDHI will continue to help investors who are ready to listen to the facts with an open mind. Only this can make you money and not believing in the fake news.

Take it from us, the overall quality of the economy has improved and markets will also follow suit and hence look at India with a positive mindset.

When you visit www.vridhi.co.in on a laptop or desktop, you can subscribe for email alerts on future articles. If you are browsing on phone then scroll to the bottom for the ‘follow’ button. Do stay connected with us. Click Here for all modes.

Happy 2019

Vivek Karwa

Not Much to Fear

181223 – Those who had read the previous MarketFastFood article dated 9-12-18 would have found things post that very interesting. If you did not read Click Here, read it first and then continue reading this article.

First, I had said, don’t fear the state election results too much, they are going to be insignificant in the current scenario. I had posted two charts showing how markets have behaved in the past.

What happened finally? Though all the three states were lost by the ruling party, the markets gave thumbs up to the results. The Sensex and Nifty closed in the green on the same day. Why? It’s all due to the vote share pattern! If you look at the vote share, as an investor you will be least bothered on the results outcome.

Second, Though I had mentioned market looks good, the volatility will remain. Check the data, on the article day 9-12-18, Sensex was 35673, it hit high of 36554 on 19-12-18 and as I write today’s MFF, we are at 35742, hardly any movement!

Third, It was mentioned that RBI will not increase the rates and it went as expected. No rate hike and no impact of Urjit Patel’s resignation.

Fourth, I had mentioned that we had recommended MGL to MFF clients and the stock still remains in our portfolio’s. It hit a high of 907 recently.

Hence, my stance on the market continues to be neutral right now, Buy on dips, but be very selective on what you are buying. Volatility will persist till Lok Sabha Elections and hence no blind buying until then. Seek an Investment Adviser’s help.

Till the general elections are over, my views can drastically change as the events unfold, hence stay tuned to www.VRIDHI.co.in and follow this page. Read the last paragraph of this article.

One can ask why am I neutral and not negative on the market in spite of America’s partial shut down.

As of now, I am least bothered about what is happening in America. Not that they don’t affect us, just that I don’t fear America movements like before currently.

Good things are happening in India.

Inflation is so much under control that RBI won’t think of rate hike even in the next meeting. Remember the inflation in 2012-13? It hit above 12% and we are today under 3% little more down and we can reach deflationary situations! That would be negative but will not happen.

Banks are collecting the earlier written off NPA’s back. Government is funding the Public Sector Banks heavily. Look at the stock movements of strong PSU banks. They are so stable. (Not a buy recommendation)

The GST rates have been cut yesterday. Now hardly around 22 goods are remaining under the 28% category. The market will celebrate this for sure. I have in a number of TV interviews and articles said that in 2-3 yrs post-GST the overall tax paid by the common public will come down. A recent report already states that a common man is saving Rs.320 already, mainly due to FMCG products.

We as a country are heading into interesting times. Don’t go by what news you read. With elections hardly 4 months far, you need to read every news with two teaspoons of salt. Better to stay connected to VRIDHI.

I promise to mention few Investment Ideas before the New Year article. Keep following us. Read the below para.

When you visit www.vridhi.co.in on a laptop or desktop, you can subscribe for email alerts on future articles. If you are browsing on phone then scroll to the bottom for the ‘follow’ button. Do stay connected with us. Click Here for all modes.

Happy Investing

Vivek Karwa

Sensex 2019

Mr. VivekKarwa is the Chairman of the Expert Committee at the prestigious Hindustan Chamber of Commerce which is organising the #Sensex2019 program on 16-12-18 at Chennai.

Do click the link below and Register.

Click Here

Election Mania or Maniac?

181209 – Sensex, in absolute terms has moved up 600 points since the last MarketFastFood post, the high was even more. We during this period bought a stock called UPL and also exited with quick returns before it fell again. The idea was not to indulge into trading, as said in the previous MFF post, the market had been volatile and after the recent rally we just thought to exit before it comes down, and it did come down. We recently recommended the stock MGL in the portfolios. Will exit the same when the situation warrants.

Vivek Karwa’s Quote:

While investing keep in mind, there is nothing called Short Term, Medium Term or Long Term, there is only Profit Term..!

The next point of view in the previous article was that RBI will not increase the rates and they followed MFF J

We also feel that the chances of FED increasing the rates this month have come down to 50:50, earlier the chances were much higher. Also, the election results won’t impact much, the impact may be seen for maximum Three days. Read the previous article by scrolling down. Also, see the pictures below sent to us from IDFC Mutual Fund. These pictures give us so much sense.

Another analysis below:

Exit polls surveys have been declared predicting not a good picture for BJP while giving an advantage to Congress. Rajasthan would go to Congress, tough fight in MP and Chhattisgarh, TRS will take Telangana. Manipur doesn’t matter!

Let’s first discuss why I don’t give any importance to these exit polls and then let’s divide the results into scenarios.

Why these exit polls don’t matter?

First, Exit polls in the last few occasions have failed. Gujarat is an example.

Second, Rajasthan has always voted government’s alternately between both the major parties. Hence, technically it’s congresses turn now. The market won’t see Congress coming back to power as a negative.

Third, After 15 years of anti-incumbency, a defeat cannot be termed as bad. It’s actually embarrassment even that after decades of one-party rule, the exit polls don’t give a clear victory to the opposition there.

Fourth, Market will be more bothered about the 2019 Lok Sabha polls, these state results have no implications on them. Voters have become smart. They have selectively started voting differently for state and central elections even while held at the same time.

The market will see this negatively only in one aspect: The number game in Rajya Sabha changes!

Scenarios:

Rajasthan: Congress, MP and CH: BJP

The positive impact, as per general expectations hence the market will take this as no surprise.

Rajasthan, MP: Congress, CH: BJP

Anything more than Rajasthan to Congress is a negative news, but just for three days.

All three states BJP: Super news for the market! Would be a dreadful defeat for the opposition. Already Telangana seems to slip out of the Con-TDP combine.

Hence when the finals are just around the corner, don’t bother much about the so-called semi-finals. Choosing a CM face and a PM face are two different things now.

Yes, whatever the results are there would be short and quick volatility, those fully invested can just ignore it and ride through it, and those with cash in hand can look at entry points if they arise.

The overall valuations in certain pockets are cheap now, keep in mind that market will turn around. It sometimes takes little longer time and with so many events happening the flat trend of over markets can continue till Lok Sabha polls. If all three states are won by the sitting government then the flat may start trending up slowly.

So let’s have some fun over the next two days. EVM’s are damn scared that they should not be finally blamed on 11th J

Don’t forget to like our Facebook page to remain updated Click Here. Also when you visit www.vridhi.co.in on a laptop or desktop, you can subscribe for email alerts on future articles. Do stay connected with us. Click Here for all modes.

Thanks

Vivek Karwa

Elections! Should I Invest?

181125 – Not much ‘absolute’ movement in Sensex and Nifty since the last post of MarketFastFood, this is the advantage of not looking at the markets daily, you just witness the destination and don’t have to experience the volatile ride, what am I trying to say here? It’s this: If you look at the absolute movement since the last post the difference is almost negligible, but if you check the daily movements you would get shocked. We saw wild movements during the past fortnight. Hence if you need to have a peaceful mind then take help of money managers like VRIDHI and we take care of your financial planning while you concentrate on your work in the office.

Generally, one advice I give to people is: concentrate on your business or job, try to earn as much as possible there and invest that money with help of an investment advisor, who in turn would make your money work most for you. Most people who come to my office seeking advice have one thing in common, most of them would have few market mobile apps like moneycontrol installed in their smartphones and they frequently check them during the office hours. Keep in mind that in this competitive world you got to be indispensable, else… you know what I mean, thus focussing on your job becomes the most important thing.

There are few queries which are coming to me regularly from investors past few days. Let’s see them.

1. My investments both in equities and mutual funds are in negative past one year. Should I sell and come out and invest in fixed deposits?

Withdrawing your investments since the market has not performed in past is the most stupid thing a person can do. As a financial advisor, I always say that don’t come to market with lesser than 5 years as time horizon. Keep in mind that you are indirectly investing in businesses and no business can give you returns quickly. The fastest way to double your money is possible only at a casino and the chance still remains just 50:50

Stay invested, keep adding more on every dip. Buy when the market is giving you a discount.

2. State election results are around the corner and Lok Sabha will go to polls early next year. Should I wait?

These are just reasons to procrastinate! Sensex was started in 1978 with 100 points, more than 40 years up and we are around at 35000 today. Now go back and calculate:

How many elections have taken place in 40 years?

How many PM’s we have seen in the past 40 years?

How many scams we have seen in 40 years?

How many natural calamities have occurred in 40 years?

The list goes on…

Still, the Sensex has moved from 100 to 35000..! Great Job. Yes, I agree there would be volatility!

3. Since you yourself said there would be volatility, what should an investor do?

Volatility will surely be there, but that does not mean you should sell and sit in cash, volatility does not mean only downwards, it could mean upwards too! Hence selling and sitting in cash cannot be the solution.

Existing investors can reduce volatility by being more defensive. There are many ways to do it and you should call your portfolio manager on this.

If you are having fresh money you can split the investment over the next 9 months. It’s easier said than done, discipline becomes very important here. Can be done with help of mutual funds, a mutual funds adviser will again be of great help here.

You can also ask why 9 months? It could be 6 as well, or 12 as well. My calculation says 9 would be the best.

The answers to the above three queries should reduce a lot of confusion. Keep in mind, a Fixed Deposit has never made anyone rich! You need to invest in markets. The more time you wait in the market, the more you can earn!

Some advisors may tell you: Don’t bother about anything, invest and wait for 20 years and you will automatically make money! Sad Advice! I agree you will make money, but you will lose on many opportunities! With time the investment methods also change. Warren Buffet style cannot be blindly followed in 2018. Those Buy and Hold advisors preach this to reduce there own workload. I find no other reasons for such advice.

Indian Stock Markets would do well, it seems almost clear that RBI would not increase interest rates at least in next two meetings. Crude has come down steeply. Inflation is under control. Future of markets at least in India seems great. Be part of it or lose yourself in deposits! The choice is yours.

Don’t forget to like our Facebook page to remain updated Click Here. Also when you visit www.vridhi.co.in on a laptop or desktop, you can subscribe for email alerts on future articles. Do stay connected with us. Click Here for all modes.

Happy Investing

Vivek Karwa

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