AMIT MARATHE
Co-Founder, Wise Turtle LLP
India's large-cap stock index has doubled in the past 4 years. The EPS (earnings per share) has also gone up in tandem. Supported by lower leverage and improved earnings growth, the mid and small-cap indices have also rallied in "fast and furious" mode over the past 12 months.
In addition to earnings growth, the gush of continuous domestic liquidity, stable macros, political stability, government capex, better and improved performance of public sector companies, continuity of policies and reforms has led to a strong bull run in the Indian equity markets.
However, after a 4-year dream run, some segments of the market have become over heated. It is pertinent to pay attention to the below quote on risk given the pace of the rally.
"Actual risk is highest when the perception of risk is lowest and vice versa" As the markets reach new all-time highs, it is crucial for investors to reassess their current asset allocation. In most investment portfolio's the percentage of equity allocation has gone up. This can be attributed to both return contribution as well as fresh inflows which tend to follow asset classes with the best returns. The markets tend to suck in all excess liquidity during good times.
The Role of Asset Allocation in Investing
Asset allocation is more than just a buzzword in the world of investing. It is a key strategy that determines the long-term performance of an investment portfolio. While market timing and fund/security selection are often highlighted as drivers of success, the reality is that asset allocation plays a far more crucial role in achieving financial goals and mitigating portfolio volatility.
Role of different asset classes in Investments:
هذه القصة مأخوذة من طبعة September 2024 من Outlook Money.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك ? تسجيل الدخول
هذه القصة مأخوذة من طبعة September 2024 من Outlook Money.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك? تسجيل الدخول
Here's How To Claim Tax Refund If You Missed The ITR Deadline
The Income-tax Act, 1961, allows the refund of any excess income tax deducted on your income beyond your actual tax liability.
26 Spiels You Should Not Fall For
We have a list of 26 traps that you should avoid in your journey to creating wealth
Unified Pension Scheme
The Union Cabinet approved the Unified Pension Scheme (UPS) on August 24, 2024, guaranteeing 50 per cent of the salary as assured pension for central government employees.
Unlocking Financial Freedom with Freedom SIP: A Beginner's Guide
Freedom SIP is the smartest way to finance your retirement because it allows you to ride the compounding rocket to build wealth, even by investing a small monthly sum.
Asset Allocation Strategy to Safeguard Against Market Fluctuations
Invest in different asset classes, such as equities, debt, gold, etc., so that if a particular segment doesn't perform in a given situation, others will come to the rescue.
The Role of Asset Allocation in Investing
A proper mix of asset allocation that aligns with investor's goals is key to the portfolio's long-term performance and reaching milestones.
Why Retirement Planning is Crucial in Life
Retirement planning is the key if you want a financially secure life in your sunset years.
IS SENIOR HOUSING FOR YOU?
Many seniors have taken refuge in senior living facilities in their twilight years as their children have moved abroad. While that may help them ward off boredom, they often come at a huge cost
WITH OR WITHOUT INDEXATION: WHEN DO HOMEOWNERS PAY LESS?
Calculating taxes under both methods-considering inflation and property appreciation-can yield a more precise result
Flexing Its Way Across Market Cycles
Very few funds meet investors' expectations of delivering superior returns across market cycles, and HDFC Flexi Cap Fund is one of them.
