Timing the market is not possible, but investors could look at buying index funds

Timing the market is not possible. However, at this juncture, it is better to have a staggered approach. The choice of stocks vs mutual funds is always an individual choice. I will advise buying the Index fund right now, Satish Kumar, Head of Equities, Equirus Securities, said in an interview with Moneycontrol’s Kshitij Anand.

Edited excerpt:

A) Timing the market is not possible. However, at this juncture, it is better to have a staggered approach. The choice of stocks versus mutual funds is always an individual choice. I will advise buying the index fund right now.

A) The broking industry will see more casualties in the near future.

A) Right now the stock prices have no meaning as investors are trying to price their worst nightmares. So pinpointing what will go down because of the fundamental reason is futile.

Hotspot test is simple from now on (i.e. if markets fall further) higher the FII holding higher the correction.

A) It’s a fad and like all fad, it will also be over pretty soon. No company can survive which doesn’t care from its customers or employees. Social impact well that’s debatable.

I can argue that even carmakers are not ESG compliant (because they make a car which causes pollution) why to single out only tobacco or fossil fuel companies.

A) Excel extrapolation is a simple job and as an analyst, I am also forced to do it. However, as of now, no one knows what will be the earnings growth or decline.

One can pick any number as per one’s convenience. Market flows will remain muted until market recovers by 20 percent then we can start seeing some flows back to the market

A) Human beings are extremely resilient and have the habit of forgetting the painful past. While for some months one may wear masks and maintain social distance; however, the fatigue of changing ingrained habits will be too much.

Moreover, please remember at worst, it will take 12-18 months for vaccine and then we will be back to basics in no time.

A) Multi bagger we don’t know - getting 2X, 3x returns requires patience and a hell lot of it. For the next 12 months scenario we like large caps. Our picks are HDFC Bank, ICICI Bank, Britannia, PI Industries, Ultratech, and Siemens.

A) May be where the mass gathering is required like malls cinema halls. What I mean here that one can be underweight sectors like Retail, airlines, etc.

As I said earlier for some months people will remain cautious and during that period P&L of many companies will take deep hit. Having said that, during the P&L hit these companies will give excellent buying opportunities.

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