At a time when the macroeconomic environment looks fragile, one should buy stocks available at cheaper valuations and remain invested for a long time to earn good returns, said S Naren, CIO, ICICI Prudential AMC in a chat with CNBC TV18.
"You invest in cheap stocks when the economy is down and you get good returns in the long run," Naren said.
The key five indicators of the economy - the credit growth, power demand, oil demand, container traffic and auto numbers - are indicating the economy is in bad shape relatively.
For most of the time, when the economy is down, the entire market is down. However, some largecap stocks have bucked this trend this time.
"Many largecaps or megacaps are not cheap this time. However, the rest of the market is at a reasonable valuation. So, one should look towards those stocks," Naren said.
Naren is of the view that the economy will take some time to recover and one should remain invested for a longer time.
Raamdeo Agrawal of Motilal Oswal Financial Services thinks the economy will not go down from here."I don't think the economy will deteriorate any further from hereon. I am 100 percent invested. We invest in quality and growth," Agrawal said.