As West Asia tensions continue to keep global markets on edge, investors should remain focused on long-term goals rather than trying to time market movements, according to HDFC AMC Managing Director and CEO Navneet Munot. In an exclusive chat with ET Now on the sidelines of an investors’ awareness campaign, Munot said India remains resilient despite external challenges and is well-positioned to emerge stronger from the current period of uncertainty.
Peace will be positive for markets and economy
Created with AI. Errors are possibleOn Middle East tensions. Munot said a return to peace would be beneficial for the global economy.
“The whole of humanity has been waiting for peace to prevail, and I hope better sense prevails and we go back to a peaceful environment. That will be good for everyone, including us,” Munot said.
“Credit to our policymakers for taking the right steps to ensure that we continue to build more resilience in the economy. Like every previous crisis, we will come out stronger,” he added.
Falling oil prices could boost India’s macro fundamentals
According to Munot, one of the biggest economic benefits of peace would be lower crude oil prices, which could improve several key macroeconomic indicators for India.
“If peace comes back and we have a truce leading to a fall in oil prices, that will directly impact our macro positively — be it trade deficit, current account deficit, capital flows or inflation,” he said.
Domestic investors continue to show resilience
While foreign institutional investors (FIIs) have remained net sellers in recent months, Munot highlighted the strength shown by domestic investors.
He noted that systematic investment plan (SIP) inflows have continued to hit record levels, providing stability to the markets even during periods of volatility.
“We have seen continuing resilience from domestic investors while foreign portfolio investors have been net sellers,” he said.
SIP flows are sustainable, says Munot
Responding to concerns about whether record SIP inflows can be maintained, Munot said similar questions have been raised repeatedly over the last decade as monthly investments kept rising.
Monthly SIP inflows have grown from just over Rs 3,000 crore in 2016 to more than Rs 30,000 crore today.
“At every point in time, it has been asked how sustainable this is. Our answer has been that there are a variety of factors leading to a sustained increase in SIP flows,” Munot said.
“The durable and more sustainable part is the SIP flows,” he said.
Don’t try to time the market
Asked about asset allocation amid volatility across equities, bonds and precious metals, Munot reiterated the importance of discipline.
“Continue to invest in a disciplined manner. Everybody should focus on their asset allocation, long-term goals, time horizon and risk appetite. It is better to remain disciplined rather than trying to keep timing the market,” he said.
RBI measures supporting bond market sentiment
“The government remains on the path of fiscal consolidation, and, if economic fundamentals remain strong, we could see the return of foreign investors. That will have positive implications on bond yields also,” he said.
HDFC AMC expands women-focused investor awareness campaign
Apart from market discussions, Munot also spoke about HDFC AMC’s investor awareness initiative aimed at encouraging greater participation of women in financial markets.
The campaign, called “Bachat Se Nivesh Yatra”, seeks to help women move from traditional saving habits to long-term investing through mutual funds.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
