Sensex, Nifty at record high; here’s what you should do with your portfolio

Gautam Shah, founder and chief strategist, Goldilocks Premium Research believes that investors should stay put with largecap despite the record high levels. Benchmark equity indices BSE Sensex jumped over 200 points to scale a fresh lifetime high in early trade on Wednesday, following strong GDP data and heavy foreign fund inflow. The broader NSE Nifty too surged to its lifetime high of 17,194.35.

The market analyst has advised investors to keep 75% of the portfolio in large caps amid the ongoing rally.

“We believe midcaps can see some correction in the next three months. Overall, you cannot compare the ongoing rally with the previous rallies. This time the markets have seen shallow corrections. In the previous rallies like 2003-2007, benchmark indices even witnessed a correction of 10-15%,” he said adding this is a very unique bull market and there is no scope for ego and fear.

He further added that Nifty may achieve 17,300-17,500 in the near term. However, it may see some consolidation going ahead. “I still like largecaps right now and investors should buy all the dips,” he said.

Shah advised investors to keep the banking, capital goods and the real estate sectors on the radar. “These sectors may give some good opportunities to market participants,” he said. Sharing his thoughts on the auto sector, he said that investors should adopt a stock-specific approach while picking stocks from the sector. He likes Bajaj Auto in the auto space.

Commenting on the midcap and smallcap indices, he said that BSE Midcap and BSE Smallcap indices will not move much higher after the humungous rally since March 2020. “Correction is coming in the midcap space. This is not the time to be adventurous in the midcap segment. Investors should stay with the sector leaders in the midcap space,” Shah added.