Going global

By Nagaland Post | Publish Date: 8/25/2021 1:43:57 PM IST


There was a time in our lives when the choices were limited and opportunities were few. My hometown used to have two or three schools, and their students felt proud to don their uniforms. Am-bassadors or Fiats were the only private cars to own, Lifebuoy or Lux to wash our dart, and ThumpsUp or Limca to quench our thirst. If you had a relative living in a foreign land, you would perhaps get to use Camay soap and Pantene shampoo, whenever they visit India. 

For you to understand this, you must be in your 40s and above. And by no means do I want you to brood over your age, but rather enjoy the changes you have seen. Now we have German auto giants opening showrooms in my hometown. You can order an Italian pizza over the phone. Wear GAP T-shirts, bought locally. The gap between the metros and the smaller cities has narrowed. And with the advent of the internet and the way we are using it, our lives have changed.

I have always been advocating that a portion of your investment should be in equity. Equity means owning a part of a business. When people ask me which business they should be a part of, the most simple answer is: the business which you yourself are a customer of. If you like a particular brand of coffee or T-shirt, you are not the only one. There are probably thousands of people who also like the things you like. That’s because, as consumers, when we choose a product or service, we tend to choose it for the price we are paying and the value we are getting. And if you carefully see, there are only a few winners across different sectors, and they are the best equities for your investments. 

Since we are increasingly using global products, the question naturally arises: Can we invest in Glob-al equity? The answer is yes, we can. In fact, almost all major Asset Management Companies have global funds and they are predominately focused in the US market. And looking at the statistics, about 0.4 per cent of our total assets in mutual funds are invested in global markets. Looking at the market dominance by the tech giants of USA, like - Apple, Alphabet, Microsoft, Facebook, etc., you should not lose the opportunity to hedge some of your assets into the global funds. 

Another reason for me to mention it now is because of our valuations. With the market at it’s peak, the Indian market looks costly for new money to be invested in it. But these global funds have a lev-erage of putting their money in different markets and if we are heading towards a bearish market after a bull run, this is the time for you to explore opportunities in global market if not for anything else, but for pure hedging. 

Now that you know about the opportunities in global funds, the question is - how much of your port-folio should you expose to global funds? This is a very tricky question. This will very from investor to investor, depending on one’s risk appetite. Experts agree that ten per cent of your portfolio is a com-fortable exposer in a global fund. And they also agree that one should not go beyond 30 per cent, even if one is well-versed with the finances across the globe. As an emerging market, India still holds a bigger prospect in the short to medium term.

Dipankar Jakharia, 



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