“The market is working like it was before the lockdown, and so am I,” says he. If at all, an afternoon nap has been the new addition to his daily routine, says he.
Does that mean he has been a bit more relaxed these days? “Maybe,” he admits. “This has been an extra advantage for siesta, family time and more reading.”
Mittal made his mark as an equity investor when he managed to pick a few quality midcaps and smallcaps early into their growth phases. He was among the earliest investors in stocks like Can Fin Homes, Symphony, Cera Sanitaryware, Wim Plast, Acrysil, VST Tillers and Amara Raja Batteries, which made good money for him.
“Research and investment can be done well from the comfort of your home,” he says. He has also been trying to stay in touch with colleagues and clients through various means of technology.
But Mittal is not really happy working from home. “There are some positives of the lockdown, like more family time and reduced pollution. However, the negatives far outweigh the positives. We hope this will end sooner than later,” he said.
Because of the wild choppiness that domestic equities have been witnessing, Mittal has stopped watching the trading screen on a daily basis.
“The volatility we are witnessing these days can force anyone to make mistakes. It’s important not to remain glued to the trading screen, unless one trades on a daily basis for a living,” Mittal said, adding that he is not sitting on the sidelines either.
BSE Sensex has crashed more than 30 per cent in last two months as uncertainty over the coronavirus pandemic and its impact on the economy continue to weigh on investor sentiment.
Select midcap and smallcap stocks across sectors look highly attractive after the recent fall. “I have been trying to accumulate stocks on every major correction,” he said.
He said it makes sense for equity investors to stay fully invested at this stage, but at the same time one must keep a decent amount in an emergency fund for at least 6-12 months.
“One should only invest from the surplus accrued from monthly earnings. Also, this is a good time to evaluate all the stocks in the portfolio and make changes within,” Mittal said.
He said new equity investors are lucky lot, as they have all the funds to invest in the market and this massive market correction has come as a godsend for them.
He, however, cautioned investors to be very careful in picking stocks. “It does look like a great opportunity for investment amid this temporary setback to the economy. But do remember that some companies are going to be impacted permanently. So, no matter what your status is, invest only that money which you won’t need for next 3-4 years,” he said.
Mittal feels waiting for a market bottom is a futile exercise. “At this point of time, things could go either way. Any extension in the lockdown may further deteriorate business and market sentiment,” he says.
“The market will throw up a decent opportunity in next six months. Instead of trying to predict the bottom, one should try and accumulate stocks in a staggered manner,” he said.
Mittal himself is looking for companies with stronger balance sheets. “Such companies will emerge stronger after this lockdown. My approach is bottom up. I am buying in sectors like rice, auto ancillaries, pharma, FMCG and metals,” he said.
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