Practitioners’ Insights: Equity Investments for Long-Term Wealth Creation

Over the last few years, global equity markets have undergone a significant change in core underlying assumptions such as continuous easing of interest rates and the thought process on valuation approaches such as focus on sustainability and excessive dependence on technology firms for outperformance. First, a huge COVID-19 wave impacted the markets and led to disruption in the commodities space along with sharp changes in global supply chains. As a result of overheating of the economy, interest rates started to go up. As a global slowdown became evident, the performance of equities was a surprise to many. Amid all this uncertainty and volatility, Indian markets had a very good year in 2023. However, this outperformance was also characterized by some very interesting trends, including: (a) small and mid-caps did considerably better than large caps, (b) BFSI and tech underperformed, and (c) domestic flows remained robust and helped the markets when foreign investors turned negative. This webinar will discuss some of these issues and focus on how investors can focus on long-term wealth creation in markets. The presenter will also touch upon issues like important global and local factors, the likely trajectory for the Indian markets over a long-term horizon, and the broader macro-opportunity.

Learning Outcomes:

• How should investors think about some of the key topics in markets today: (a) outlook for conventional banking and financial services stocks and likely impact of speed bumps for sector disruptors, (b) the large caps vs. mid and small caps, and (c) possible rate cuts in the US and impact on emerging markets, and d) the relevant issues for global economy.
• How have Indian markets behaved when valuations went higher, and how does the risk-reward appear today? The increase in number of demat accounts, evolving and developing appetite for equities in Tier II and Tier III cities, excessive trading in F&O segments—how will all this will play out in medium to long term and what will be the impact?
• The current state of equity markets and the future trends we may witness over the next few years. How should investments factor in characteristics of different market segments, such as sectors and market cap categories, in the context of long-term value creation in the equity markets.

This is the archived version of a live webinar that took place on 21 March 2024