Here's some advice from Shankar Sharma to young investors in bear markets
5paisa Research Team
Last Updated: 24th February 2022 - 11:59 am
This is nothing but the normalization of overpriced IPO stocks, he says.
While the markets are facing turbulent times, every decision taken becomes so crucial. For retail investors, this is a test of temperament. Post-covid we have seen a greater involvement of retail investors like never before which is clearly reflected by the sheer number of Demat accounts opened last year. The long bull rally we had witnessed had taken markets on new highs and IPO season too helped the cause. However, as the markets have become hesitant, the questions pop up whether we are embracing bears and what retail investors should look forward to!
Market expert Shankar Sharma has expressed his views on the markets and has some lessons to teach to retail investors. He believes that the indices are in a correction that is completely normal and sane. What he feels insane is the overpriced valuations of the frenzy IPO stocks like Nykaa, Zomato and others. As the indices are down by just about 2% on a year-to-date basis, he feels the overpriced stocks are ones being crushed while we head towards a reality check.
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Talking about buying at bargains, he said he does not believe in averaging down which might defy popular opinions. One thing he pointed out was that as bull markets can extend beyond logic, bear markets too can extend beyond logic. And so as a word of advice he says that it’s a great learning opportunity for us all to back to basics and reassess our investment strategies by keeping an eye out on fundamentals.
“Bull markets are high on earnings and low on earnings, bear markets are low on earnings and high on learnings”, he added. He also feels that blaming markets for your losses doesn’t make sense and that you should introspect on your studies to bring positive changes.
Also read: Check out the small caps that attracted domestic mutual fund money last quarter
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