Investment: After Sensex reaches 80000, should we withdraw money from equity and buy gold? Or invest in fixed income

Multi Asset Allocation : If you invest in the equity market, did you evaluate your portfolio after Sensex reached 80000 and Nifty reached 24000? The equity market is at its peak and has been giving good returns for a long time. In such a situation, did you notice that your equity portfolio looks expensive now or should it continue like this? If not, then you should evaluate your portfolio now and focus on asset allocation afresh. At present, you can balance your portfolio in equity, debt or fixed income and gold, so that there is no loss. Brokerage house Axis Securities has given a report on multi asset allocation at present.

Brokerage gives model portfolio for investment, list includes 8 largecap and 6 midcap stocks

A smart investor is one who evaluates his portfolio from time to time. Balance your portfolio with different asset classes according to the mood and environment of the market. So that your portfolio gets diversification and better returns can be achieved while managing the risk. In which market cycle, how much money should be where in which asset class like equity, gold, bond or any other asset, has its own importance. However, all this should be done keeping in mind your risk taking capacity and time horizon.

What is the view on which asset right now?

Equity: Overweight: Good start but volatile way ahead; macros to remain centre stage

Debt: Neutral

Gold: Neutral

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Allocation based on risk profile (%)

Equity

No risk takers at all: 0%
Conservative investors: 20%
Balanced Investors: 50%
Growth investors: 70%
Aggressive Investors: 90%

date

No risk takers at all: 70%
Conservative investors: 70%
Balanced Investors: 35%
Growth Investors: 15%
Aggressive Investors: 5%

Gold

No risk takers at all: 30%
Conservative investors: 10%
Balanced Investors: 15%
Growth Investors: 15%
Aggressive Investors: 5%

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FY25 started well, but……

Brokerage house Axis Securities believes that with the recent rally in the market, most of the narratives are already priced in. The market is likely to adjust with fundamentals. In that regard, style and sector rotation will play a big role in alpha generation. In the near term, market fundamentals will be driven by a few factors: 1) macroeconomic developments; 2) some pre-budget signals; 3) Q1FY25 earnings; 4) progress of monsoon; 5) direction of bond yields; 5) oil prices, and 6) fund flows.

Margin of safety is higher in large cap

Moreover, midcaps and smallcaps have rallied significantly in the last few months and as of now, the margin of safety in midcaps and smallcaps has reduced as compared to largecaps. Keeping this in mind, the broader market may see some short-term correction in some sectors in the near term and the flow is likely to shift towards largecaps.

Based on this, we believe Nifty50 could see a new high in the near term. The brokerage maintains a Nifty target of 24,600 by March 2025. Hence, investors are advised to stay in the market and maintain good liquidity (10%) to utilise any dips phase-wise and build positions in high quality companies (where earnings visibility is quite high) with a 12 to 18 month horizon.

13 to 16% return in a month, you can earn profit up to Rs 32 thousand by investing Rs 2 lakh

Market eyes on Union Budget

The brokerage house says that the Vote-of-Account-Budget sets the narrative of a “developed India”. We believe the budget has proactively set the direction for economic growth in the coming years. It envisions a “developed India” by 2047, following a transformation similar to that seen in the last decade. Market borrowings for FY25 are estimated at Rs 11.75 lakh crore and the bond market has reacted positively to this budget figure.

Key highlights from the Interim Budget: 1) Reasonable fiscal math; 2) Significant positive outlook on infrastructure; 3) Increased allocation for PM Awas Yojana; 4) Rooftop solarisation (Suryoday Yojana), and 5) Boost to Nano DAP and aquaculture production. The market is now eyeing the upcoming Union Budget which will be presented on July 23, 2024.