Posted by: Babu Suresh | December 31, 2008

Wealth Creation – Indian Stock Market

I want to share with you an interesting telecon I had today, after the market was over with one of the analysts I respect a lot, for he loves his job, his analysis, highly conservative in his calls but cares a lot about his clients.

He, for the first time sounded concerned about not being able to create wealth for his clients in this market.

I got an opportunity to share with him my experience and observation of this market.

1. Unlike the last phase, i.e. 2006 to Apr. 2008, % of retail participants has drastically fallen along with the volume.
2. Perception of the market is yet to change among the traders
3. Major int’l markets have slowly disintegrated since Oct.08 and therefore, influence on inter-markets have considerably receded.
4. Yen Carry Trade, the major boosting factor in the last 5 years for the growth of all the major markets across the globe has virtually come to stand still since Oct.08.
5. Cheaper assets in the western markets that has reduced apeal on other emerging markets such as ours.

6. Complacency, the most debilitating decease, overwhelmingly present in certain markets over a very long period, has begun to visibly recede, thanks to sub-prime, Alt-A etc.

So, at the end I concluded saying, notwithstanding all the afore mentioned points, this is the best market to create wealth, provided, we change our perception of the market,  start learning and understanding the new dimensions of this market,  adapt ourselves to the present market conditions instead of complaining about it and change our paradigm of the stock market.

Wish you all a highly Healthy and Wealthy New Year.

Healthy and Wealthy Trading. 🙂

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