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Moneycontrol Pro Panorama | The rise and rise of retail investor

In today’s edition of Moneycontrol Pro Panorama: Moment of truth for market, the FOMO factor, why inflation view has an issue , Repco Home Finance makes a point, a bright spot in logistics, recipe for success for hotel sector, and more

June 30, 2021 / 02:52 PM IST

Dear Reader,

The Panorama newsletter is sent to Moneycontrol Pro subscribers on market days. It offers easy access to stories published on Moneycontrol Pro and gives a little extra by setting out a context or an event or trend that investors should keep track of.

The profile of the retail investor is changing. The average individual investor entering the markets these days is likely to be young and tech-savvy.

Earlier this month, the Bombay Stock Exchange said it had crossed 70 million registered users. Six out of every 10 users are in the 20-40 years age bracket, said the exchange. These new investors are no longer restricted to metros; they are spread across the country.

They are more technically savvy, used to trading on apps from new age discount brokers such as Zerodha and Upstox. They are ok with making trades based on financial memes and in the US, Robinhood traders and redditors are bleeding hedge funds.

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Why is there such a surge?

It could be the lockdown and working from home atmosphere which is pushing people towards the equity markets. Returns on other instruments are tepid in comparison. To use new age jargon, these investors also might have FOMO (fear of missing out) on this rally.

It is also a pointer to increasing financialisation of assets. But the increasing presence of retail investors is worrying some market participants because it is changing the underlying market structure.

As Shishir Asthana points out, foreign and domestic institutional investor participation as a percentage of the total volumes is at a 15-year low. This could be reason for concern, as retail money is flighty and there will be a stampede for the exit at the slightest sign of trouble. You can read his analysis here.

Do check out these investing insights from our research team:

Allcargo Logistics: Macroeconomic tailwinds to fuel growth

Two big positives in Repco Home Finance’s earnings

Thangamayil Jewellers: A shining future ahead

Solara Active: Build-up of CRAMS pipeline to help rerate

What else are we reading today?

BIS builds three scenarios for the global economy

Not just fiscal relief, a blend of many ingredients needed to spice up hotel sector

High time to reinvent SEZs

Apollo Hospitals’ digital plans resonate after PharmEasy-Thyrocare deal

The inherent instability of the Goldilocks market consensus (Republished from the FT)

Technical picks Hikal, Hindustan Unilever, Torrent Power and TCS

Ravi Krishnan

Moneycontrol Pro
Ravi Krishnan is deputy executive editor at Moneycontrol
first published: Jun 30, 2021 02:52 pm

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