The benchmark Nifty and Sensex closed 1 percent higher on Friday but that may not serve to lift the nervousness that has set in with the market’s sliding trend since middle of September and its sharp fall a month before that.
In the weekly round-up, brokerage analysts have attributed the poor show to global developments such as high interest rates and growth concerns, and lacklustre September-quarter earnings.
Also read: Nifty reclaims 19,000 as bears ease control; what's pulling the market higher?
Veteran investors, however, seem to have spotted a bright spot as they see this as an opportunity to buy, despite the odds, if not a "divine strategy".
Samir Arora, the founder and fund manager of Helios Capital, which has recently launched mutual fund scheme Helios Flexi Cap Fund, accepting investments from November 6, was quick to point out the value of a good entry point. He posted:
“Fund Mgr to God- Bless us so that we deliver good returns to investors.
God: *thinking emoji*
You know that part of good returns come from good entry prices. Let me see what I can do.”
As a comment under the tweet, he said the market dip provides a good opportunity to generate an alpha for anyone who has just launched a fund.
Safir Anand too pointed out the opportunity a drawdown brings. “What else does an investor do on severe drawdown days but buy?” He asked in his tweet. “Part of returns is not just buying good stocks but buying systematically in drawdowns knowing investing is a piggy bank where every coin adds up.”
When a comment to his post asked him whether it would be better to wait for the fall to stop, pointing to several negative cues such as heavy selling by retail and institutional investors, Anand responded with the strategy he is employing.
He has bought in the drawdown and he will buy more if the market falls further “by spreading and switching”. He seemed to be suggesting diversifying and dynamically changing allocations, along with continuous buying.
Balaji Vaidyanath, director of NAFA Asset Managers, said that investors should not look at this merely as a fall or rise in the market, instead, he suggests looking at the market move more segmentally. NAFA Asset Managers’ view is that this drop gives good opportunities in the largecap space. In the midcap space, Vaidyanath said that investors should wait for further correction.
In the midst of these optimistic voices, a few others captured the icy chill that came with the plunge in the indices.
A few days ago, when the Bank Nifty seemed to have fallen off a steep slope, Shankar Sharma called all the divinities to protect a person from the index’s fate. "Upar waaley sey sirf ek hi prarthana hai: Hey Bhagwan, Ya Allah, Yo Ishu, Waahey Guru, insaan ke jeevan ka chart present Bank Nifty jaisa na ho. (I have only one prayer to the almighty… A human life’s trajectory should never be like that of Bank Nifty’s)."
The index has fallen by nearly 7.5 percent since its high in mid-September.
On today’s trend reversal, Deepak Jasani, head of research at HDFC Securities, said that the six-day losing streak snapped because of positive global cues such as the US economy’s robust growth data and forecasts from Amazon and Intel. “Volumes on the NSE did not rise with the reversal but fell towards recent lows.”
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