What will be the direction of Stock Markets after hitting record highs? Should investors stay invested or sell at highs? Zee Business Managing Editor speaks to Basant Maheshwari of B M Wealth Advisor LLP to reveal profitable strategy.

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Maheshwari says that this year has put investors through virtually everything - from coronavirus, market lows to new record highs for Sensex and Nifty. Going forward from today, he said that a small correction is possible in markets at current levels, however, the trend remains strong on the upside. As far is liquidity is concerned, it is very much there in the market and it will keep chasing good quality stocks.  

Investors should not worry about finding another Infosys or Kotak Bank as when they try to find these kinds of companies, they get higher returns when the time is good, however during tough times all gains are easily wiped off.  If one doesn’t want to invest in HDFC Bank (Top Private Bank), they can prefer to invest in second best or third best in private Banking space. Similarly, if one does not intend to invest in HUL (Top player) from FMCG space, they can invest in second or third best company in same space. 

It is important to stay invested in market by investing in quality stocks. It may fetch you 10% less returns but will ensure that investors are safe and protect their wealth.  

Fundamentally, if investors see Indian economy then they should sell substantial portion of their portfolio and sit on cash. Strong liquidity will find its destination and reach to companies where they see growth. It is difficult to predict returns when things are looking attractive from Fundamental view. Fundamental analysis and awareness is important but one should not keep blind faith on it.  Market has witnessed that stocks have risen much higher than one thinks and also have fallen much more than one can imagine. Liquidity and Bull markets go hand in hand; one should enjoy this phase of markets. This phenomenon has been witnessed in past also by investors.  

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In today’s world we have seen people prefer Coalition government being celebrated and people are scared of absolute majority. Markets have witnessed lot of uncertainty when Trump was President. One tweet from him could see the market swinging both ways. Global markets would witness more stability from here on.   

Investment themes have changed rapidly over past few months; Telecom witnessed huge flows during the initial stage of Covid, followed by Liquor companies. Now, banking sector seems extremely attractive at current valuations. Globally, people have accepted that they will have to live with corona virus taking precautionary measures until the vaccine is found. Now investors should look at Anti-covid themes, people will give less importance to corona virus by Jan – Feb 2021 and companies in banking space and financials seems to do well from here on. Investors should invest in top names if their risk appetite is low in these sectors.