Remain invested in stocks; quality smallcaps will yield lucrative returns, says Aman Soni of Prudent Equity

livemint.com:

Aman Soni, Head of Operations at Prudent Equity, believes one should remain invested in stocks but the quantum is something one needs to identify based on their time frame and risk appetite. In an interview with Mint, Soni also shared his views on the market and his strategy for the mid and small-cap space. Edited excerpts: Never shy away from investing in equities.

Since equities have been the greatest performing asset class since their existence, we continue to be optimistic about them. Even though we are at an all-time high, one shouldn't give up on investing. Profit-booking is a practice that is both prominent and ongoing.

However, to reinvest that money back into the market, one must also continuously look for fresher opportunities. We have seen enormous PE (price-to-earnings) expansion in most industries last year, and going forward, the only thing that will drive markets will be earnings. We are likely to experience some volatility as we approach election season; while keeping some cash on hand can be useful, one should remain invested in stocks, the quantum is something one needs to identify based on their time frame and risk appetite.

Also Read: We have shifted focus from debt to equity schemes, says Ravi Jha of LIC Mutual Fund Valuations are the only thing concerning at today’s levels, markets are pricing all the good news and there is no room for error, even a slight miss would lead to correction. As they say, bull markets climb a wall of worry and bear markets slide down a river of hope. In every bull market, there are pockets of extreme exuberance and an area which is still in its infancy.