Do it yourself

इशरत - ए - क़तरा है दरिया में फ़ना हो जाना   दर्द का हद से गुज़रना है दवा हो जाना — मिर्ज़ा ग़ालिब (Aspiration of every drop of water is to get extinguished by immersing itself into the ocean. For a person who is hurt in love, extreme pain is the only relief.) I interacted with a small but reasonably representative sample of investors in the past few days. The interactions were in person meetings, discussions over telephone and WhatsApp chats. We discussed a wide range of topics that are current in investors’ memory. The idea was to understand their current outlook on markets. From my discussions I have concluded that currently a majority of investors are ambivalent about their investment outlook and strategy. They are perplexed, greedy, fearful and relieved all at the same time. The following are some random thoughts based on my latest interaction with a sample of investors. Some random thoughts It is customary to read and quote investment classics duri...

market participants; while gold has also given decent return. Greed begins to overwhelm fears Despite a spate of terrible economic, political and geopolitical events, the greed has started to overwhelm the fears since the market made a panic bottom in March 2020. The midcap stocks have outperformed the benchmark indices, and the small caps have also started to catch up recently. (i)     The benchmark Nifty is negative ~15% YTD (22 June 2020), whereas Midcap are down (-13%). Small cap index is down by 20%. (ii)    Overall market breadth has turned marginally positive for the YTD. (iii)   Foreign investors turned big sellers again after remaining net buyers in 2019. Domestic mutual funds bought more than the FPI selling. Net institutional flows have been thus positive YTD. However, in recent funds the net new flows into the equity mutual funds have slowed down. (iv)    Pharma is the only sector that has retur...