If you are following the market daily, it has been a tough few days....maybe even a few weeks...
The number of stocks hitting 52-week low seems to be rising all the time along with our blood pressure as well. And some of us try to research why the market is falling......sometimes it is attributed to the tax law changes while at other times it is attributed to global changes!! As travellers, when a flight is delayed, we are used to hearing "incoming flight was delayed" as a standard reason!!
After our FM proposed higher income tax surcharge on taxpayers with income of ₹2-5 crore, FPIs have sold shares worth $1.87 billion in July alone, after making net purchases of $11.34 billion in the January-June period. Domestic institutional investors were net sellers of ₹7,609 crore shares till June, but there was an inflow of ₹13,167.73 crore in July, the highest monthly inflow so far in 2019.
Understandably, this causes a lot of concern for investors.
Investing is a function of value and potential for future growth. An asset class that has generated significant returns over the past 40 years never goes up or down in a straight line. For investors who did not invest aggressively into equities during the last cycle, the investors and newcomers who are seeing their first bear market, this is a great time to get aggressively into Indian equities.
As the structural factors affecting the economy change for the better, well thought out investment decisions made during tough times always pays off. Just as we are one of only 4 countries attempting to land on the moon, so will we be the 3rd largest economy soon.
As investors, we urge you to look at this as an opportunity and add to Equity allocation keeping in mind your long term goals.