STOCK – At this point, one of the most common and common questions faced by all investors is whether to book profits or restructure a personal portfolio to close the portfolio profits.
From now on, small and mid-cap packs bring the opportunity to make a profit for those who are ready to stay invested with a long-term vision.
As the second wave of the epidemic has hit our country more angrily than any other country globally, all central provinces have opted for partial or complete closure of the COVID-19 sewage spread. But, unfortunately, given this situation, it seems likely that the epidemic will not end anytime soon or until most of the Indian population is vaccinated.
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At the time, one of the most common questions that plagued all investors was whether to book profits or restructure a personal portfolio to close the portfolio profits. However, before we try to answer a question or decide, let us first understand the situation.
Phase 1 (First Wave)
An unexpected virus struck the world when the Indian economy began to show the first signs of economic recovery. The epidemic had swept across the country, and although the government was unwilling to deal with any form of closure, there was no alternative, and it began to close. In conclusion, the economic movement has grown to a halt as people across the country should be obliged to secure themselves in their houses to protect themselves from the deadly virus. The dramatic increase in medical infra was evident because a significant outbreak was an hour-long need to deal with the epidemic and potentially worse times to come.
As a result of domestic and international uncertainty, the Indian stock market has reacted strongly and lost almost ten times the trading volume. Post lockdown, the government and the RBI have taken several steps to improve planned funding. One of the measures was to reduce prices and provide momentum as a way to revitalize the economy. In addition, various announcements have followed in this budget to increase infrastructure and productivity in the country. These measures have helped revitalize the economy, which can be seen in many of the barriers to economic activity.
Phase 2 (Second Wave)
Based on our previous experience, individuals, companies, and governments were better able to manage changing times. There was a lot of money in the system. Medical infra was better prepared. Therefore, the government focused on resource management, which helped prevent another nationwide closure cycle. Major economic activities such as infra and manufacturing are maintained as they directly or indirectly affect the lives of young people.
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After examining both positions, it is clear that a person can book a profit not by sitting in cash or by switching to a debt fund but by restructuring a portfolio. This is the time to cut back on the distribution of large-cap stocks and move the money into medium, small, and medium-sized categories. Staying in cash or trying to time markets will only lead to the erosion of long-term profit. The meanings of this decision are as follows:
The government has brutally gone out of its way to improve the economy through its various measures such as reducing corporate taxes, developing a stimulus (PLI) production plan, working on the necessary changes, and ousting ‘Atmnirbhar Bharat,’ which has the power to put India on a new path to economic growth. Therefore a growth-minded government aims to spend money on infrastructure and other vital sectors associated with lower corporate finance costs in the market over the medium term.
A few years ago, the market was fragmented, with heavy metering indicators becoming new peaks while the border market failed to keep pace. However, in the current rally, the upward trend was much broader with the participation of all sectors and market fabrics. This is an indication that confidence in economic growth is returning. However, the small index-cap will still hold almost 40% from its peak lifespan in January 2018. Interestingly, at the same time, Nifty and Sensex are up about 40%.
The high spending plan announced during the Union 2021 Budget aims to help the economy grow and heal faster. That, in turn, will help midcap and stock-cap stocks, which are closely aligned with local economic recovery. So, in the future, small and medium-sized pockets offer the opportunity to make a profit for those who are ready to stay invested with a long-term vision.