Why I am investing 10Cr (slowly) in 2025 | Akshat Shrivastava

Summary

The speaker offers an in-depth analysis of current market conditions, covering key topics such as stock performance, global economic strategies, and investment opportunities. They highlight how stocks like HDFC have outperformed the market, share insights on China and Europe’s quantitative easing efforts, and discuss mutual fund strategies. The speaker is bullish on China, particularly the Hang Seng index, and outlines how trade war concerns have already been priced into the market. Ultimately, they encourage retail investors to deploy cash before major fund managers act, believing that the market has bottomed out and will only improve from here.

Takeaways

• 😀 HDFC Bank has outperformed the market by 20% over the past 1.5 years, despite criticism, highlighting the importance of strong, stable stocks in the market.
• 😀 Stocks like HDFC are considered market savers, with stable companies helping the market to sustain in challenging times.
• 😀 China and Europe are adopting quantitative easing, similar to India’s approach from a few years ago, by borrowing at high rates to inject liquidity into their economies.
• 😀 The expectation is that China and Europe will significantly increase government expenditure, driving their stock markets in the future.
• 😀 The speaker’s investment in Chinese stocks, particularly the Hang Seng, has yielded a 40% return, validating their bullish stance on China.
• 😀 Retail investors should watch mutual fund cash positions carefully, as funds like Parak Parik are holding substantial cash reserves (e.g., 20%) to deploy at the right time.
• 😀 It’s not effective to mirror mutual fund strategies based on delayed data; by the time it’s available, stocks have already risen.
• 😀 Retail investors should aim to invest just before mutual funds deploy their cash reserves, even if it means taking a short-term risk for long-term gains.
• 😀 The trade war concerns that have affected the market in the past are now fully factored in, meaning any new trade developments are unlikely to have the same impact.
• 😀 Positive news around geopolitical issues, like a potential resolution to the Russia-Ukraine situation, could drive market recovery and stability.
• 😀 The speaker is optimistic about the market bottoming out and has already deployed their cash in both US and Indian markets, with a focus on long-term growth.

Q & A

What is the key reason HDFC stocks have been performing well?

HDFC stocks have been outperforming the market by 20% because they are considered essential stocks that are supporting the overall market, despite previous criticism and undervaluation.

How does quantitative easing in Europe and China affect the stock market?

Quantitative easing, which involves injecting liquidity into the market, is expected to drive stock market growth in Europe and China. This strategy is similar to what India implemented a few years ago, where government expenditure boosted market performance.

Why does the speaker mention China’s Hang Seng index?

The speaker had invested in China’s Hang Seng index, and it has increased by 40%, indicating that their bullish stance on China has been correct. The speaker intends to increase their investment in this market further.

What is the concern with mutual funds holding large cash reserves?

Mutual funds holding large cash reserves, like Parak Parik, are likely to deploy their cash into stocks when the market is ready to rally. Retail investors who follow these funds may miss out on gains because the market prices would have already risen by the time they are informed.

What should retail investors do if they want to follow mutual fund strategies?

Retail investors should invest before the mutual funds deploy their cash, anticipating the market movement. This requires timing the market well, as waiting for updates from mutual funds can result in missing out on the best gains.

How did the trade war concerns affect the market?

The trade war concerns, especially between the US and China, were a major factor in the market's decline. However, these concerns have already been factored into the market, meaning that future developments regarding trade wars are unlikely to have negative impacts.

What is the speaker’s outlook for the next six months in the market?

The speaker expects that the market will become more certain over the next six months. They anticipate good news from trade resolutions and increased stability, which will likely drive market growth.

How is the speaker managing their investments amidst market uncertainty?

The speaker has started to deploy their cash into both the US and Indian markets, despite the market uncertainties. They plan to continue investing any new funds into these markets, believing that future conditions will improve.

Why is the speaker optimistic about future trade news?

The speaker is optimistic about future trade news because the trade war concerns have already been factored into the market, and they believe only positive developments, such as trade resolutions, will impact the market moving forward.

What is the significance of government bonds in China and Europe?

China and European countries, like Germany and Italy, are issuing government bonds with high interest rates. This indicates that they plan to borrow and spend this money in their economies, which is expected to drive stock market growth as government expenditures increase.