Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Bet on the long term... - Views on News from Equitymaster
  • E-MAIL
  • A  A  A
  • Mar 24, 2005

    Bet on the long term...

    What's with the markets? That's what most of us investors would be wondering. At first, they continue to break new highs after new highs, and then they fall as if there is no tomorrow! But then, let's not forget the laws of gravity: 'what goes up comes down and vice versa'.

    To be fair to the readers of this column, they have been bombarded with caution, a longer-term outlook and toning down of return expectations, continuously. It is not really going to be any different today.

    It is very clear now that Indian indices dance to the tune of Foreign Institutional Investors (FIIs) movements. And they in turn, take a stance based on what Mr. Greenspan's outlook of US rates is. And currently, the bets are on US rates rising faster than expected. If that happens, obviously some of the foreign funds may like to park funds closer home with less risk. But if such is the case, investors should continue to see the markets fall and therefore, should beat a hasty exit.

    In our view, there is no reason to panic. Atleast not for those who invested in Indian equities with a long term view (see we told you, it's not going to be different). We believe that India continues to occupy a key position in the FII radar. Structurally, the economy is headed in the right direction barring some misgivings. Banking reforms seem on, FDI in telecom, insurance and construction is in, talks are on for pension reforms, patent bill is through, infrastructure focus continues and more importantly, India Inc. continues to thrive in competition and is more outward looking than 5 years back. India is a big economy and moving slowly but surely in the right direction. In that sense, we need not overtly worry about attracting foreign investment to Indian equities.

    Another key positive is the push towards building an equity culture in India. In our view, the tax benefits to equity investors are attractive. Dividend is not taxable and any capital gains (if you hold on for 1 year or more) tax too is zero. Compared to other avenues, this is surely a big draw in the longer term. With the FM freeing up the Rs 1 lakh limit for investors to choose from different avenues, equities could see a sizeable allocation going forward.

    India Inc. is likely to sustain its growth momentum in the medium to long term. Therefore, equity investing is likely to give a decent 'inflation' beating return in the long run. Happy investing!



    Equitymaster requests your view! Post a comment on "Bet on the long term...". Click here!


    More Views on News

    How to Ride Alongside India's Best Fund Managers (The 5 Minute Wrapup)

    Jun 10, 2017

    Forty Indian investing gurus, as worthy of imitation as the legendary Peter Lynch, can help you get rich in the stock market.

    You've Heard of Timeless Books... Ever Heard of Timeless Stocks? (The 5 Minute Wrapup)

    Aug 19, 2017

    Ever heard of Lindy Effect? Find out how you can use it to pick timeless stocks.

    Why NOW Is the WORST Time for Index Investing (The 5 Minute Wrapup)

    Aug 18, 2017

    Buying the index now will hardly help make money in stocks even in ten years.

    Trump Takes a Beating (Vivek Kaul's Diary)

    Aug 18, 2017

    Donald J Trump, a wrasslin' fan, took a 'Holy Sh*t!' blow on Tuesday.

    How To Read Your Mutual Fund Account Statement Correctly (Outside View)

    Aug 17, 2017

    PersonalFN simplifies the mutual fund account statement for you.

    More Views on News

    Most Popular

    Demonetisation Barely Made Any Difference to Tax Collections(Vivek Kaul's Diary)

    Aug 7, 2017

    The data tells us quite a different story from the one the government is trying to project.

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    7 Financial Gifts For Your Sister This Raksha Bandhan(Outside View)

    Aug 7, 2017

    Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...

    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms


    Aug 18, 2017 (Close)