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About Bitcoin, Small caps and Growth investing!

About Bitcoin, Small caps and Growth investing!

Nowadays, when you open a newspaper or switch-on a news channel, you hear three themes quite often & loud—Bitcoin, Small-cap and Growth-stocks. All of them are making headlines because of their steep moves. We hear all those statistics where brokers lure people saying, ‘If you had invested Rs. 10,000 in a certain thing sometime back, it would have become 5-10-100 Lacs!’ What do we call this frenzy? And, why is it happening? We call it Fear of Missing Out (FOMO)—a very popular term in stock markets. Markets have been reacting swiftly to each theme, as people are getting greedy. There is too much money in the system globally. Bond prices are coming down due to increase in interest rates, so the money is being parked in equities for retirement goals. In India specifically, the salaries are not growing like they did before (12-16%), Real estate is not booming, gold has […]

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Category:Economy, News

Moody’s Rating upgrade: Positive for Long term

Moody’s upgraded India’s sovereign rating to Baa2 from Baa3 with Stable Outlook. What do ratings mean? Credit Rating reflects financial strength of a country when it raises money from the debt markets. Ratings vary from Aaa to D. ‘AAA’ rated asset/Sovereign is considered the safest. Safest assets/sovereign can raise loan at the cheapest rate. All countries are rated in relation to each other. Any rating equal to or above Baa3 (S&P BBB-) is considered as “investment grade”. Ratings below that are called “Junk” or Non-investment worthy. How does ratings upgrade help us? India was rated Baa3 (S&P BBB-) which was just one notch above Junk grade. This was due to poor fiscal policy, low tax base, populist budgets, etc. This ratings upgrade is a big positive. India is still a developing country. It requires large capital to build infrastructure and generate employment. Upgrade in rating can attract more investors to […]

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Category:Economy, News
How will the economy evolve and stock markets react if Congress forms a coalition government?

How will the economy evolve and stock markets react if Congress forms a coalition government?

Over the last few weeks we have been trying to look at probable economic outcomes and stock market scenarios given different possible political outcomes after the 2014 General Election. An Investor desiring safety needs to run such thought exercises if he is investing in India. For a simple reason that the economic policy understanding that existed among the political parties of various hues in between 1991-2004 (even if it was in fits and starts) has somehow broken down over the last few years. As such political outcomes have a very strong impact on the economic scenarios that can play out. This time we would like to see what if contrary to most opinion polls Congress still ends up showing a strong performance even if say, it’s worse than 2009 but still sufficient to form the government in one form or the other. In spite of very strong headwinds against Congress […]

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How will the economy evolve and stock markets react if BJP forms a weak coalition government?

How will the economy evolve and stock markets react if BJP forms a weak coalition government?

Over the next few months the most talked about event dominating the Indian investors mind would be the 2014 General Elections. One just needs to look at the relative performance of the Sensex 30 compared to its peers Bovespa (Brazil Index) and Shanghai Composite Index (China Index) to gauge the strength displayed by the Indian indices. While most Emerging market indices have been weak over last 6 months, Sensex has been stable without any clearly visible decisive trend. We believe that the major reason for this is because most market participants are keeping their fingers crossed with respect to the outcome of General Election. In continuation of our effort to fill the gap in the analysis presented to the investors as a result of political impact, this week to look at one more scenarios that has an equally strong probability, but is underappreciated by the markets as of today. Before […]

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How will economy evolve if BJP coalition wins in 2014 General Election?

Today the most talked about topic is ‘2014 General Election’. If one were to switch on any news channel today, we can be certain of one thing, there are showing either Election debates or what was said by any of the political personality in the course of the day against other political party. In short, there is saturated coverage on election and politics. However one thing that is not covered by the most of the commentators is how the outcome of this election is likely to impact the mood of the nation. In the first of these series, we would try and fill up this gap at least as far as the economy and stock markets go. This week, we are starting by asking ourselves “What if a Centre-Right-BJP led coalition was to win this general election?” Before we start contemplating the possible effect of BJP forming a government at […]

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