ETMarkets Smart Talk: Cautious on smallcaps & midcaps till risk-reward becomes favourable: Dr Poonam Tandon
“We expect such rich valuations can result in increased equity volatility and we would stay cautious till the risk-reward becomes favourable,” says Dr. Poonam Tandon, Chief Investment Officer at IndiaFirst Life.
In an interview with ETMarkets, Tandon said: “We believe one should keep some cash margin in their short-term portfolio and can take some money off the table especially from expensive stocks which have rallied ahead of their fundamentals” Edited excerpts:
What a week for Indian markets – 20,000 and counting – what next?
This year despite global markets having a challenging outlook, the Nifty50 has reported an impressive return of +15% along with broader markets also performing.
The outperformance of the Indian equity markets was driven by favourable macro and micro factors along with continuous inflows by FIIs and strong retail participation.
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Offering CollegeCourseWebsiteIndian School of BusinessISB Chief Digital OfficerVisitIndian School of BusinessISB Chief Technology OfficerVisitIIM LucknowIIML Chief Marketing Officer ProgrammeVisitGiven that the continued rally in the market has resulted in elevated valuation, we believe significant upside from here on seems to be capped for some time now and it will be a function of stability in the global and domestic macros.
It seems like the maximum interest is in small & midcap space. Is the FOMO which is causing the catching-up?
Yes, the market sentiments in the mid-cap and small-cap space have been quite exuberant as they have outperformed the Nifty by a big margin – this financial year (YTD), the NSEMidcap 100 index is up ~35% and NSESmallcap 250 index is up ~40% as against the Nifty which gave a return of 16% during
