Simply Save | Should you take sector-specific bets during market volatility or stick to diversified mutual fund schemes?

Stock markets have been volatile due to a wide range of factors. The Russia-Ukraine crisis has triggered a price rise of Brent crude oil, which is never good news for India due to its heavy dependence on oil imports.

In year-to-date to terms, the price of Brent crude oil is up 50 percent, trading at $116 per barrel. There has also been rise in prices of gas as supply from Russia has been impacted due to the ongoing conflict.

However, stocks of companies that are crude oil and gas producers – companies such as ONGC, Oil India and Gail – can benefit from the rising energy prices. So, does such sector-specific bets through direct stocks, sector funds or customised ETFs like smallcase, make sense for retail investors. Or should they stick to diversified mutual funds?

We have seen at the peak of Covid-19 crisis, pharma and IT sectors had benefitted the most. On the other hand, returns from equity markets have been disappointing for investors so far in the new year with several factors contributing to market volatility – rising inflation, crude oil prices, US Fed rate hike and Russia-Ukraine crisis.

Having corrected as much as 13 percent since January 17, the S&P BSE Sensex and CNX NSE Nifty have recovered, but are still down by about five percent.

In today’s episode of Simply Save Podcast, Moneycontrol’s Jash Kriplani speaks with Shridatta Bhandwaldar, head-equities, Canara Robeco Mutual Fund, who oversees over Rs 33,000 crore worth of equity investments, on how investors should navigate their way out of the stock market volatility, how value style of investing can help with diversification and the problem with assigning value to emerging asset classes like cryptocurrencies.