Nilesh Shah advises investors to focus on quality, avoid smallcap SIPs amid market uncertainty
«In those days, when Sunil Gavaskar used to get out, the hopes on rest of the batsmen was very-very low. Today, barring India, most other countries in emerging market like Russia, China, Brazil, South Africa, have not delivered return to investors. Over 20-year period, emerging markets underperformed developed markets,» says Nilesh Shah, MD, Kotak AMC.
Exactly a month ago, this market had a lot of event risk, budget, Trump and tariffs, then there was RBI, MPC, and then Delhi elections. Thankfully for us, we have come on the right side of all the individual events. So, if events were making markets nervous and if the events are behind us and we have been on the right side of the event, then do you think it is a matter of time markets will stabilise?
Nilesh Shah: So, in our opinion, while there are certain events which are behind us, there are few things which will keep market on the volatile side. One, we are in a world which is increasingly becoming protectionist from globalised, with Trump administration launching newer and newer initiatives for America first, there will be concerns on geopolitical side.
If that event risk is not enough, we are also seeing consistent selling from FPI. There is ghar waapsi of global capital to US.
We saw one of a large private equity fund going and meeting President Trump and saying that you had asked me to bring $100 billion, here I am bringing $500 billion. Clearly, America first policy and higher interest rates, as well as high bond yields is pushing capital back to America.
