Hi All !
Uncertainty is the hallmark of stock market investing ! I am talking about 5-6 large brokerage houses such as CLSA, Credit Suisse etc going underweight on India. Reasons are simple:
1) Indian stocks have already performed quite well since past 20 months , hence they are relatively over valued vis a vis its other Emerging Market peers.
2) Rupee depreciation risk is real as Current Account Deficit is still persisting and crude is going up at least till this winter as energy shortage is real. So as a corollary NIFTY50 will face margin pressure as Crude is Raw material for more than half the NIFTY 50 names.
So a million dollar question is:
What an Indian Investor should do?
Few easy recommended steps to counter this:
1) Take Overseas exposure (via direct equity investment if you can or can invest in good MF with significant overseas exposure.PPFAS Flexicap Fund is a good fund footing the bill )
2) Gold could be a good hedge- so accumulate Gold ETFs upto 4-5 % of your overall equity exposure
Let us have fun while it all is happening. Let us start with a stock game: