July has seen a turnaround for the equity markets. Sensex is up about 10% from 53k to 58k in July and currently around 59k.
See the signs.
- Oil is falling.
- The foreign investors have turned buyers after months of selling.
- Even though Fed raised rates in the US, the markets went up, which means that it was not an unexpected action.
- RBI too has not indicated a very aggressive stance going forward.
Given all this, has the bull market run started again. Maybe, maybe not.
The markets are a voting machine in the short term and a weighing machine in the long term.
It seems that market prices have adjusted to everything that can go wrong. But is the market ready for overall move up?
Doesn’t seem so.
As of Aug 1, 2022, the Unovest Market Allocation Indicator looks like this. Here’s the link to the webpage.
It's the middle.
It doesn't mean you should be scared or sell your investments. You should be in the markets but not the time to go all in.
A 50% allocation to equity in your portfolio is reasonable.
Ongoing allocation to the markets for building long term wealth is a good way to go from here.
If you are getting started with mutual funds for building wealth, do look at this resource guide for everything on mutual funds. (Do share this education with newbie investors and anyone who is planning to invest in mutual funds)
If you have built your savings / investments over time (or as some financial service companies would call as HNI), you are likely facing with a lot of dilemma about how to structure and drive your portfolio going forward.
This is a good note cum reminder about what really matters for you, dear HNI.
You see equity is for optimists. Over 10, 20 or 30 years, you can hope to build generation wealth with the right mindset and behaviour.
For whatever strange reason, this is not yet clear to several investors. They continue to look at markets for 1, 2 or 3 years. This is the biggest behaviour gap holding them back.
You too? Then write or talk to us.