Dhruvi Shah’s Post

Market Alert: Sensex Sheds 700+ Points, Wiping Off Investor Wealth 📉 The recent Sensex plunge is a stark reminder of market volatility. Let's break down the potential drivers behind this significant drop. Key Factors Contributing to the Decline: Global Fears: Worries about rising interest rates and global economic slowdown are fueling investor anxiety. 🌍 FII Selling: Foreign institutional investors are offloading holdings, putting pressure on Indian markets. 📉 Sectoral Weaknesses: IT, banking, and metal stocks are seeing significant declines, impacting overall market sentiment. 💻💰📉 What Investors Should Consider: Reassess Risk: This downturn might signal a need to reevaluate your exposure to riskier assets. 🤔 Seek Quality: Focus on fundamentally strong companies with potential to weather market storms. 💪 Diversification Matters: A well-diversified portfolio can help mitigate losses during market swings. 🌐 Stay Informed: Monitor market news and expert analysis to make informed investment decisions. 📰 My takeaway: While market corrections can be unsettling, they present long-term buying opportunities for prepared investors. 👀 Let's Discuss! How are you navigating the current market conditions? Share your strategies below. 👇 #Sensex #marketcrash #investing #volatility #india #finance

Good Data Point to Look Today ✅️ Equity Market witness 10-20% declines almost every year ✅️ Only 4 out of the last 44 calendar years have seen intra-year declines of less than 10%. In 2024, we have yet to see such a correction. ✅️ Despite this, in 35 of those 44 years, the Sensex (stock market index) has provided positive returns. So, even though the market can be unstable, it generally benefits investors over time. source - Funds India Research - Based on the data we can say, almost every year the market offers opportunities to invest and book profits. - After the market frenzy, It seems the market is humbling investors. The profit-booking phase seems to be behind for 2024. Happy investing - Jaymin Join Capital Insights for finance update - https://lnkd.in/dHRrRnvg #IndianEquityMarket #Sensex #Nifty50 #EquityInvestment #MarketVolatility

Investing is all about making smart moves, and one of the smartest is leveraging #sectorrotation. This strategy can significantly boost your portfolio's performance. Let’s break down how it works and why it’s effective. #What is Sector Rotation? Sector rotation involves shifting your investments across different market sectors based on economic cycles and market conditions. This proactive approach helps you capitalize on growth opportunities and manage risks more effectively. #Why Sector Rotation? 1. Economic Cycles: Different sectors shine at various stages of the economic cycle. For instance, technology and consumer discretionary sectors often thrive during economic expansions, while utilities and healthcare may perform better during downturns. 2. Risk Management: Diversifying across sectors reduces the impact of poor performance in any single sector. 3. Data-Driven Insights: Using indicators like interest rates, inflation, and GDP growth, you can predict which sectors are likely to perform well. #How to Implement Sector Rotation: 1. Monitor Economic Indicators: Keep an eye on interest rates, inflation, and other key economic indicators. 2. Analyze Market Trends: Use market analysis to spot which sectors are on the rise or decline. 3. Adjust Portfolio Accordingly: Shift investments to sectors expected to perform well in the current or upcoming economic phase. #Benefits of Sector Rotation: 1. Enhanced Returns: Focus on sectors with strong growth potential to achieve higher returns. 2. Reduced Volatility: Diversification across sectors helps smooth out portfolio performance. 3. Proactive Risk Management: Regularly adjusting your portfolio based on economic trends helps protect your investments. Gigant CIP leverages macroeconomic #insights to drive strategic sector rotation. With 20 years of experience and a robust analytical approach, customized investment portfolios are key to maximize gains and safeguard wealth. 💵🔄 Better #StayAheadOfTheCurve If you have any questions about investing/investment portfolios, don’t hesitate to contact us. Kind regards, Your gigant Team

Sensex Today | Stock Market View: Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services Global and domestic cues indicate that the market is likely to consolidate in the coming days and start responding to Q4 results as they start coming. So, Q4 results will be the next major trigger for the market from a sectoral and stock-specific perspective. Market expects good results from autos, capital goods, telecom and select pharmaceuticals. Financials,too, will report good results despite some NIM compression and, therefore, are likely to be favoured by investors. IT results will be tepid and, therefore, the management commentary will be more important than the results. Even though valuation comfort in banking is in PSU banks, private sector majors are likely to deliver superior returns from a two/year perspective.

Many investors perceive sectoral funds as risky, but a closer look at the data shared by WhiteOak Capital reveals an interesting trend. Over a 10-year period, the Nifty IT (IT Index) has outperformed the broader market index Nifty 500 around 81% of the time. This analysis is based on 10 Yr rolling returns since 2004. The Nifty 500 consists of stocks from Large/Mid/Small universe from around 20 sectors. The fact that a focused index like Nifty IT has consistently outperformed the broader Nifty 500 indicates that a strategic bet on the IT sector, timed correctly, can provide risk-adjusted returns in the long term for patient investors. I am reminded of Warren Buffet's quote - "Risk comes from not knowing what you ae doing" Disclaimer - Please consult your advisor for your investment decisions. Thank you WhiteOak Capital Aashish P Sommaiyaa Ramesh Mantri Chirag Patel, CFA Manuj Jain, CFA Your contents are always insightful!

An investigation of the day-of-the-week effect and month effect in the stock markets of the Asia-Pacific Region - Dr. Sahaj Wadhwa and Deepika Dewan The article by Dr. Sahaj Wadhwa and Deepika Dewan investigates the day-of-the-week and month-of-the-year effects on stock market returns and volatility in five Asia-Pacific stock indices. Utilizing EGARCH (1,1) modeling, the study analyzes data from January 2010 to September 2023 for NIFTY, HSI, S&P ASX, SSEC, and STI indices. Findings reveal significant day-of-the-week effects in NIFTY and STI, with positive returns on Tuesdays and Fridays in NIFTY and negative returns on Mondays in STI. However, no consistent patterns were observed in other markets. Volatility impacts were significant on Tuesdays in Indian, Hong Kong, and Singaporean markets but negative in Australia. Month-of-the-year effects were absent across all markets. The study in this article suggests that while emerging markets like India may offer opportunities for abnormal profits, developed markets like Australia and Hong Kong may not. The findings have implications for investment strategies and policy decisions to enhance market efficiency. Link: https://lnkd.in/gdqtFjtA Ranjeet Kumar Agarwal CA Charanjot Singh Nanda

Hello Connections, Recently, I had the privilege of going through a research paper "The Less-Efficient Market Hypothesis" by Cliff Asness. Cliff Asness is currently the Managing and Founding Principal at AQR Capital Management. He argues that stock markets have become less efficient over the past 30+ years. While markets should reflect all available information (Efficient Market Hypothesis), technological advancements, social media, indexing growth, and low interest rates have made pricing less accurate, especially over medium timeframes. Asness presents three main causes: 1. Indexing Growth: Passive investing reduces active price discovery, leading to larger pricing errors. 2. Low Interest Rates: Extended low rates encourage speculative behavior. 3. Technology and Social Media: Increased information speed and social media have fueled herd behavior, reducing market independence. These factors create more opportunities for disciplined value investors but make sticking with rational strategies harder due to greater market volatility. What I Learned: 1. Market Efficiency Evolves: Efficiency changes over time, requiring adaptable investment strategies. 2. Tech's Double-Edged Sword: Faster information can cause irrational price movements. 3. Challenges for Value Investing: More significant drawdowns but higher potential rewards. 4. Impact of Passive Investing: Indexing may increase inefficiencies, creating opportunities for active management. 5. Improving Investment Processes: Adaptive strategies and better data use are essential in a less efficient market. P.s.: Link to the research sheet is attached in the comments below #StockMarket #Investing #GlobalEconomy #Investing #PassiveInvesting #WealthBuilding #LongTermGrowth #finance #Nifty50 #NSE #India #US #BSE #Markets #Economy #investing #education #technicalAnalysis #buyandhold #wealth #MarketInsights #InvestmentOutlook #bull

Day 4 : Top Down vs Bottom Up Approach (Equity Research) 🕑 Top-Down Approach 📉 (Focus: Macro Factors → Sectors → Individual Companies) 1. Macro-Level Analysis: Starts with an analysis of broad economic factors such as GDP growth, inflation, interest rates, and global economic trends. Analysts consider how these factors will impact different industries and sectors. 2. Sector Selection: After identifying favorable economic conditions, the focus shifts to selecting sectors that are likely to benefit from these macrotrends. For instance, if economic growth is expected, sectors like consumer discretionary or industrials might be prioritized. 3.Stock Selection: Only after identifying the most promising sectors do analysts drill down to the company level, selecting individual stocks that are poised to benefit from sectoral trends. The focus is on identifying companies within the chosen sector that have strong fundamentals, competitive advantages, and growth potential. Bottom-Up Approach 📈 Focus: Individual Companies → Sector → Macro Factors 1. Company-Level Analysis: Starts with a detailed analysis of individual companies, regardless of the current macroeconomic environment or sector performance. Analysts focus on a company’s fundamentals, including financial performance, management quality, competitive position, and growth prospects. 2. Sector and Industry Consideration: After identifying promising companies, the focus shifts to understanding the industry and sector in which the company operates. This helps to assess the competitive landscape, regulatory environment, and other factors affecting the company. 3. Macro-Level Considerations: Finally, macroeconomic factors are considered, but they are secondary to the company’s individual performance and potential. This approach assumes that strong companies can outperform even in challenging economic environments. Choosing Between Top-Down and Bottom-Up ✂ Top-Down: Suitable for investors who prioritize macroeconomic trends and sector performance, it is often used by macro-driven funds and strategists. Bottom-Up: Ideal for value investors and those who believe in company-specific factors, typically used by stock pickers and fundamental analysts. Equivaluesearch #finance #equityresearch #equivaluesearch #markets #strategy

The biggest hindrance to fair valuation is the inherent uncertainty associated with predicting future cash flows and growth potential. This uncertainty stems from various factors, including: * Market Volatility: Fluctuations in market conditions, interest rates, and economic cycles can significantly impact a company's valuation. * Industry Disruptions: Technological advancements, shifts in consumer preferences, and regulatory changes can disrupt entire industries, making it difficult to accurately forecast future performance. * Company-Specific Risks: Factors like management quality, competitive pressures, and operational risks can influence a company's financial performance and valuation. * Information Asymmetry: In some cases, investors may have limited access to accurate and timely information about a company's financials, operations, and future prospects, leading to biased valuations. * Human Bias: Valuators themselves can be subject to cognitive biases, such as anchoring bias or confirmation bias, which can distort their assessments. Virtual Recorded Certificate Course on Ind AS. Visit www.collectmybook.in #fairvalue #IndAS

Why We Should Think Long Term in Investing Long-term investing, especially in an index like the SENSEX, can enhance the probability of not losing money. Let’s analyze the historical data from the last 24 years. If Ramesh invests in the SENSEX: 4-Year Horizon: 100% probability of positive returns. No 4-year period has ever lost money. 3-Year Horizon: 88.89% probability of positive returns. Most 3-year periods have yielded positive returns. 2-Year Horizon: 76.92% probability of positive returns. 10 of 13 periods showed gains. 1-Year Horizon: 76.00% probability of positive returns. 19 of 25 periods yielded gains. Key Insights Long-Term Stability: 4-year investments ensure 100% positive returns; 3-year investments are also high at 88.89%. Decreasing Probability with Shorter Time Frames: The probability drops as the period shortens: 76.92% for 2 years, 76.00% for 1 year. Significant Improvement After 3 Years: Notable increase in positive return probability from 2 years (76.92%) to 3 years (88.89%). Conclusion Long-term investing reduces the risk of losing money. From 2000 to 2024: 4-Year Horizon: 100% probability of positive returns. 3-Year Horizon: 88.89% probability. Invest for at least 3 years to enhance chances of positive returns. Follow Prajjawal Verma for more... Repost if you like it... Piyush Kumar Parth Verma Equivaluesearch #sharemarket #investment #india #investmentbanking