Behavioural biases that damage your investments!
In matters of investment, the sooner you acknowledge your mistakes, the sooner you'll find help in getting out of the soup. To break free from biases, the first step should be to identify those biases, says, Balwant Jain, Tax and Investment Expert.
With Nifty surpassing the 17,200-mark, Axis Securities has revised its target for Nifty 50 upwards to 17,700 for December 2021 as it believes that the earnings momentum is likely to continue amid the gradual reopening of the economy as well as significant pick up in vaccination rates. In the current calendar year, Nifty 50 has already rallied 23.42% to 17,311. The brokerage firm believes that the current rally is supported by the sequential recovery of key high-frequency indicators such as Manufacturing PMI, the GST collection, and the Google Mobility Data which are all trending higher on an M-o-M basis. With this improvement in key macro data, FIIs turned ‘buyers’ in the equity market vs. the ‘net sellers’.
Rangebound volatility
In the recent past while the mid and small cap indices underperformed benchmark indices. The volatility index remained range-bound and hovered around the 13 mark in August, which is significantly lower than the long term of 22. “The volatility index will continue to remain around these levels which rules out chances of significant market correction in the near term,” noted the report released by Axis Securities.
Quality stocks in focus
According to the brokerage house quality theme is clearly back in focus. Likes of HUL have outperformed the market during the month of August indicating the market’s focus on sustaining returns. The report also stated that even in the mid and small cap space, quality stocks have outperformed the non-quality stocks by a significant margin. Moreover, this divergence is quite significant in the small caps as compared to the large caps, clearly indicating that the allocation will increasingly shift towards quality stocks across the board.
Top picks
While Q1FY22 earnings were a mixed bag, Nifty 50 earnings have seen further upgrades on account of an encouraging performance by metals, IT, and cement sectors. With earnings likely to sustain in the coming quarters Axis Securities has shortlisted these stock that can deliver up to 30% returns in the coming quarters.
(Disclaimer: The recommendations in this story are by the respective research and brokerage firm. Money9 & its management do not bear any responsibility for their investment advice. Please consult your investment advisor before investing)