Is NRI Investments in India increasing after the recent Stock Market fall?

The major Indian stock market indices like Sensex and Nifty have been exhibiting a sign of relief in the past few days. Obviously such a holding in the index strength is coming from US market performance, but much has to be credited to Indian mutual funds that are stepping in the markets at these levels of 1500 at the Sensex.The markets are no doubt bottoming out from these weak levels, but the real question is whether this move be consistent on the upward side. The NRI helpdesk managing funds for PIOs (person of India origin) and non resident Indians have seen a tremendous downfall in the equity business in the gone month, but now the momentum is slowly catching up. Most of the big stock brokers have seen a drop of almost 50% in their business in the gone one month, in both retail and institutional sales (primarily the NRI account opening has gone down).

Our Investment Advisors at are still bullish on India, and are still advising clients to buy Indian stocks with a dollar cost averaging strategy (this strategy is definitely risky, so it is advised to take a help of a certified professional). More importantly the clients are being advised to reshuffle their portfolios by adding more of debt funds like the government and corporate bonds also, besides shares only. The idea here is to play safe, with a balanced asset portfolio with a mix of top performing mutual funds and stocks, along with some solid debt instruments; this would bring strength to the portfolio by reducing extreme volatility. However one needs to be cautious by not putting all his money in to the markets at these levels, but what experts are saying is that one should only get into this market with a long term view of say 2-3 years a minimum.

The good news is that the coming earning declaration from the Indian companies, is expected to be good, and this would definitely boost the consumer confidence and by all means this would have a positive impact on the stock markets of India, especially on the large cap shares like: Reliance Energy, HDFC Bank, Canara bank, Balram Sugar, ICICI Bank, etc. Besides the corporate earnings, lot of other mutual funds that were sitting on cash are about to come out from shells and do some major buying in the exchanges, and this would again push the index up on the curve.

The idea would be here to invest in India with caution, and as soon as the market picks momentum one can go aggressive by putting in more funds in some good mutual funds through various routes like SIPs – systematic investment plans and MIPs – monthly income plans. However the bottom still remains that the Indian boom is not over yet, and if one really needs to encash this golden opportunity then one needs to get into the share market with a positive attitude accompanied with some serious investing smartness.


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