The Hindu Business Line : ‘Best time for investing in stocks’

Bangalore, March 7 Morgan Stanley Mutual Fund has said that the best time to invest in the Indian stock market was now in spite of a slide in the bourses.

The Vice-President of Morgan Stanley Investment Management Pvt Ltd, Mr Jayesh Gandhi, said at a meeting here to discuss the Union Budget, which was organised in association with Standard Chartered and co-sponsored by The Hindu Business Line, said the market will continue to give returns of around 20 per cent.

“This is probably the best time to invest in India. If you were to look back after 25 years, you might think this was probably the best time for investing,” he said.

Once there is some stability in the US economy, which was expected to happen by the third quarter of this year, allocation by the foreign financial institutions was expected to happen again.

He pointed out that there was a constant rotation of returns across market caps.

“We don’t feel you should chase market caps. You need a judicious mix of long and mid caps,” he said. Investors should not chase the sectors either because of a constant rotation of returns.

“Don’t be sector focused. You must have a longer time horizon if you are sector focused,” he said.

There is need to take a few risks in the equity market. “But if you minimise the risks, you get fewer returns. Investors should use the volatility to their advantage,” he said.

He said to address volatility; SIP (systematic investment plan) was a good example to address the issue.

Mr Gandhi said Morgan Stanley brings a community of boutiques to the table apart from specialising in core competence in multi caps.

He said there was a view that the impact of the Union Budget on markets was diminishing. “But if you ask me whether the Union Budget will be done away with, I don’t know,” he said.

Judicious balance

Mr D. Sampathkumar, Associate Editor of The Hindu Business Line, while explaining the implications of Budget in managing the economy, said the Budget had made a judicious balance between populism and macroeconomic issues to spur growth to raise consumption demand.

He said the change in the personal income-tax and the reduction in Cenvat and the excise on automobiles are expected to spur demand resulting in the growth rate to be maintained at 8.5 per cent.

However, he felt that with the slowdown in US economy and many companies having achieved full capacity, particularly in the steel and cement sector, the expectation appeared somewhat optimistic.

More Stories on : Budget | Stock Markets

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page