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Are you still sitting on the sidelines amid the ongoing rally in the domestic equity market? If yes, you may miss the next bus which can help you to accumulate humongous wealth over the next decade. Even market mavens like Motilal Oswal’s Raamdeo Agrawal believes that the benchmark equity index BSE Sensex may hit 2,00,000-mark by 2030. Another well-known industry watcher and Mumbai-based investor Vijay Kedia earlier also said that the index may touch at 1,50,000-mark over the next 10 years.
More than 14.2 million new demat accounts were opened during the previous financial year, which is three times the figure of FY20. Going with market experts, the global pandemic led to work from home and business disruptions opened up new investment opportunities. Besides this retail participation, liquidity measures taken by the RBI and the government and inflows by foreign institutional investors lifted the market mood. This helped the domestic equity market to rally 68% during FY21. Overall, the 30-share index is up over 125% from the lows of March 2020.
Ace stock picker and Big Bull Rakesh Jhunjhunwala also believes that this is just the beginning and a huge number of demat accounts are yet to be opened. This will further increase the inflow of household savings into the market.
History shows that the equities have managed to outperform other assets classes despite black swan events like the dot com bubble burst, global financial crisis, and covid pandemic. On the other hand, due to a lack of financial education, some people avoid investing in the stock market. One should note that trading may burn all your fingers but investing can help you to generate wealth over a period of time. Take this: Sensex has delivered over 15% annualised return to investors during the past 40 years.
It is never too late to start investing. Open a demat account and start today. But don’t forget, taking expert advice is a must in negotiating the complex world of equity investments and that generating wealth takes time and one should not expect overnight returns.