The new year is expected to be uncertain for investors as a number of emerging and domestic factors – can negatively affect stock prices.
In the global front, the US central bank has said it will end an easy money policy in March and raise interest rates at least three times before 2022 ends – both thanks to a raging inflation rate, which is at a height of more than three decades.
Then there is a chance of the recent Omicron variant of Coronavirus forced countries to re-choose locking, affecting the market and economy.
In front of the domestic, as a result of the US decision, foreign funds can intensify the sale of Indian shares, which can weaken the rupee.
Increased inflation, with the wholesale price index of more than 14% and food prices show a growing trend, it can also affect the bonds and stock markets.
“2022 can be consolidated years, but it will still be a good year for equity.
But volatility can be higher than what we experienced in 2021,” said the CEO of Alchemy Capital Management, Director & CIO Hiren Ved.
In such a scenario, what should investors do? The investment advisor feels it in uncertain time when volatility can be higher, investors must hold their courage and not panic.
“This is a period requesting endurance, because investment in the equity market is for the long term.
It is important that investors remember their long-term goals to invest, instead of surrendering to panic,” said the Chairman of the Independent Financial Advisor (FIFA) Dhruv Mehta.
“While market volatility and time are certainly natural for the short-term period, a larger picture needs to keep saving long term.” This larger image may be a structural bull market in India.
“The Indian market has entered a structural bull phase again – supported by a strong macro, solid income growth and strong exports,” Ved said.
On the question where to invest, Ved felt that the internet, and new age efforts and employers could trigger the next leg from the rally for several years.
“But the failure rate (in the internet business space) can be very high too.
So, investors must be very selective, patient and careful.” Mehta felt that the market dynamics constantly changed, but there were temporary dynamics should not affect someone’s long-term financial plan.
Also, it is recommended not to read aggressively in expert opinions and negative insights on the market, which will only cause chaos and confusion.
Looking for a Mutual Fund Distributor Guide – which will hold one period and offer rational & sound fiscal suggestions – will also help investors see a greater picture, remain calm and stay focused on their financial plans and goals, regardless of the current market, he said.
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