Share Market Tips: A good rise was seen in the stock market on the last day of the trading week. Both Sensex and Nifty closed with good returns. Mid-cap and small-cap indices closed with gains of more than 1 percent.
Talking about the future of the market, Bandhan AMC’s VP Equities Viraj Kulkarni said that the valuations of large-cap stocks have now come to a reasonable level.
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He told that Nifty has remained almost flat for the last one year. During this period, the growth of earnings has been in single digits. There was pressure on the market due to heavy selling. More correction has been seen in mid and small cap stocks. However, earnings are expected to increase in the next 6 to 12 months.
Viraj Kulkarni said that the valuation of Nifty is now close to its long term average. Better support is visible in large cap shares. Whereas consolidation is necessary in mid and small caps. Small caps cannot be completely trusted at this time.
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On the question regarding lump sum investment, he said that there is a lot of uncertainty in the current market. Global events are a big factor. Tariffs, fear of recession in America and the policy of the Federal Reserve are being closely monitored.
Correction is possible in the market due to global factors. Expectations of rapid growth are low at present, although valuations now look decent. In such a situation, investing gradually can be considered the right strategy.
Regarding Bandhan Flexicap Fund, he said that this fund gives complete flexibility of investing in large, mid and small caps. There is no fixed limit for a fund manager. Generally, the weightage of mid-cap is kept between 20 to 50 percent. If the market seems expensive then the mid-cap allocation is reduced, and if the market seems cheap then it is increased.
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Talking about last year, the average mid-cap allocation was around 20 to 22 percent. Now the weightage of mid-cap seems to be more than 30 percent. Strong returns are expected going forward.
He said that discipline is maintained in allocation and the fund always remains balanced. 20 to 30 percent of the portfolio is invested in momentum and high-growth stocks. At the same time, 20 to 30 percent exposure is kept in value stocks also. 10 to 15 best stocks are selected in the Momentum category and 10 to 15 best stocks in the Value category.
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