Best opportunities - India vs US Stock Market | Where to invest now? | Akshat Shrivastava

Summary

This video discusses whether to invest more in the US market amidst upcoming elections and potential rallies. The speaker analyzes the macroeconomic factors, including interest rate cuts and stock buybacks, that could influence market performance. They also address the correlation between the Indian and US markets, the impact of currency depreciation, and offer insights on diversification and specific investment opportunities in both markets.

Takeaways

• 📉 The speaker discusses the potential of a market rally due to the upcoming US elections and suggests considering moving investments from the Indian market to the US market.
• 🏦 Interest rates have been cut in the US, which typically leads to increased economic activity and better market performance in the mid to long term.
• 📈 The speaker anticipates that the Indian government may also cut interest rates, similar to the US, which could boost the Indian market.
• 💼 Politicians have an incentive to keep stock markets up, especially during election periods, which could influence market behavior in both the US and India.
• 🔄 Stock buybacks are expected to increase significantly in the US, which can help maintain or increase stock prices and benefit shareholders.
• 💹 The speaker suggests that investors should diversify their investments, including looking at the US market, to mitigate sovereign risk.
• 🌐 There is a high correlation (around 80%) between the Indian and US stock markets, indicating that they tend to move in similar directions.
• 📊 The speaker provides a technical analysis of the NASDAQ Composite, suggesting there is potential for growth and identifying a 'cup with handle' pattern.
• 🔑 Key investment opportunities in the US market include individual stocks, particularly in tech and cybersecurity sectors.
• 🚩 The speaker has exited positions in small cap and midcap indices in India due to concerns about the composition of many loss-making companies.

Q & A

What is the main topic of the video?

The video discusses whether one should invest more in the US market due to upcoming elections and potential market rally, and compares it with the Indian market.

What is the role of interest rate cuts in stimulating economic activity?

Interest rate cuts reduce borrowing costs, leading to more economic activity as businesses and consumers are more likely to borrow and spend.

How do stock buybacks impact the stock price?

Stock buybacks can increase the stock price by reducing the number of outstanding shares, which can make the earnings per share (EPS) look better and increase demand for the remaining shares.

Why might politicians want to keep stock markets up during elections?

Politicians may want to keep stock markets up during elections as a rising market can be seen as an indicator of a healthy economy, which can influence voters' perceptions.

What is the estimated growth rate of stock buybacks in the US over the next few years?

The estimated growth rate of stock buybacks in the US is expected to be around 13% to 16% in the next few years.

What is the significance of the NASDAQ Composite's technical pattern mentioned in the video?

The NASDAQ Composite's technical pattern, described as a 'cup with handle', suggests a potential for future growth, with a technical target of around 18,000 points.

Why should investors consider diversifying their investments between the US and Indian markets?

Investors should consider diversifying to mitigate sovereign risk and because both markets offer different opportunities and are influenced by different economic factors.

What is the correlation between the Indian stock market and the US stock market according to the video?

The correlation between the Indian stock market and the US stock market is approximately 80%, indicating that they tend to move in similar directions.

How does the depreciation of the Indian Rupee (INR) affect the returns of the Indian market when compared to the US market?

The depreciation of the INR should be considered when comparing market returns because it can significantly impact the value of investments when converted to a different currency, like USD.

What is the speaker's investment thesis for the US market?

The speaker's investment thesis for the US market is based on factors like stock buybacks, low-interest rates, and potential market support due to elections, suggesting a positive outlook until 2025.

What are the key considerations the speaker has for investing in individual stocks in the US market?

The speaker considers factors like a strong balance sheet, positive cash flow, and being in a growing industry when investing in individual stocks in the US market.