Key Points
Kalpen Parekh, MD & CEO, DSP Investment Managers, says: As a house we believe these are times to invest through SIPs and these are times to add more largecaps in the portfolio and these are also times to add another asset class like fixed income where yields have risen over the last three-four years and we see signs of stabilising of interest rates and maybe over the next two-three years if interest rate cycle turns, there may be marginal gains to be made there as well...
As an investor, we are here to fulfill our long-term objectives, our personal goals, beat inflation, earn superior returns then build our purchasing power and ultimately equity as an asset class delivers that over a long period of time. 50% of the time there are chances that annual returns can be less than fixed income and that is what the last 30-35-year history has shown..
So, this is a reflection of our view that these are times to respect and in just two months back, we did a multi-asset allocation fund where again the idea was to add extra asset classes like gold and fixed income and global equities so that the investor is not only embracing one type of risk of what has done very well in the last 18 months or so...
If at all something is a matter of worry it is global geopolitical issues and how global flows move and because we are relatively more expensive than some of the other emerging markets if flows decide to you know turn to some extent that could be a matter of worry and that can lead to intermittent volatility of 10 to 20% which happens every 18 months or two years election or no election..
Normally wherever we see that the sector has consolidated or margin of safety has improved or future prospects look better so BFSI the sector we like because the sector has got cleaned up over the last five six years, credit growth gradually has started picking up, valuations have come down significantly in the last three four years because many large banks have actually not seen price depreciation whereas their book values have risen or their profits have grown at 15 to 25%..
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