What should do in this market?
In these
days, our major market indexes are performing very well (Sensex and Nifty).
Market indexes are at their highest points, equity mutual funds also improving
performances, investor’s portfolio’s health improving in these days. Now the
major questions are why equity market performing are in India and what should
an investor or trader do at this point. First we are discussing about the
factors which are responsible for market’s current performance.
The reason behind the market rally:
- Some people are expecting the stable and growth oriented government after the election.
- FII (Foreign Institutional Investors) investments in our markets are improving from last few months.
- Indian rupee is appreciating against dollar and it is also the major factor behind this according to me.
What should the investor do?
- If you have already equity portfolio then you must hedge your position. After market any major negative swing wipe out your portfolio valuation so hedging your portfolio are necessary to avoid any loss.
- No doubt, markets will perform good in the next 2-3 year but shot term trader should cautious and do the trade with strict stop loss as near term upside seem not much, Nifty level should not cross the 7200-7300 after even election result.
- If you are investing in equity mutual fund by monthly SIP (Systematic Investment Plan) to achieve your future long term goal then you should stay invested and before two year you should transfer your equity portfolio into debt portfolio.
- Before investing in particular company’s stock, check the company’s fundamental and valuation whether it is overprice or trading at below from fair value at present. There are still many good companies available at good price in spite of market at its life time high.
If you want more information
regarding investment or you have any other query about investment feel free to
ask us.
Warm regards,
Arvind Trivedi
Certified
Financial Planner
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