Regulatory changes can also play a role in how the market shapes up, says Sarvjeet Virk co-founder, MD Finvasia Group
Retail investors benefit from a safer and more transparent environment, while institutional investors may need to adjust their trading strategies and risk management practices. This is amid the recent SEBI's scrutiny on F&O segment.
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Economic indicators like inflation, interest rates, GDP, and employment provide insights into market conditions and future trends. Regulatory changes can also play a role in how the market shapes up, said Sarvjeet Virk, Co-founder & MD, Shoonya by Finvasia in an exclusive email interview with ZeeBiz.com
Sarvjeet Virk is the co-founder and MD of Finvasia Group, a global financial company, also housing Shoonya (a data-powered, signal based, zero brokerage, trading & investment platform). With close to 2 decades of professional experience, Sarvjeet is responsible for formulating strategies and assessing risk for businesses across markets, like capital markets and investment banking, at Finvasia group level.
With dual MBAs in International Business from Amity University and another from Baruch College in New York, Sarvjeet spent 12 years in the US and Canada collaborating with industry giants. During this time, he executed multi-billion dollar projects, engaged with thought leaders, and played pivotal roles in high-level business processes.
Edited Excerpts:
Q1. As markets are climbing new highs, what is your view on market outlook given the macros and the current volatility trend.
The recent volatility can be an opportunity for investors to enter the market for at least the next 2-3 years. The Indian stock market is expected to grow given the strong macroeconomic factors and an excellent first quarter of FY25. There can be some near-term corrections in the market driven by global triggers or other global and political factors, but those can be looked at as entry points rather than any kind of profit-booking in the market. Another major factor that might drive the markets is the expected drop in inflation and rate cuts in the near term. This can boost the manufacturing and other core sectors, which can open an array of opportunities for investors. Domestic investment is surging significantly. Decreasing dependence on foreign investors also indicates a growing market.
Q2. SEBI’s scrutiny of F&O, the imperative behind it and what does it means for varied stakeholders?
SEBI's scrutiny of the Futures and Options (F&O) market is a strategic move aimed at ensuring investor protection and market stability. Derivative markets, while offering lucrative opportunities, can also be highly volatile and risky. The regulator's focus on this segment is a proactive step to mitigate potential risks and promote a healthy, well-regulated ecosystem.
The imperative behind SEBI's scrutiny lies in safeguarding retail investors from excessive risk exposure, maintaining market stability, and ensuring fair practices. By introducing regulatory measures, SEBI seeks to prevent market manipulation and create a level playing field for all participants.
The implications of SEBI's scrutiny vary across different stakeholders. Retail investors benefit from a safer and more transparent environment, while institutional investors may need to adjust their trading strategies and risk management practices. Brokers and exchanges may face higher compliance costs but also stand to benefit from a more vibrant and well-regulated market. This is evidenced by the significant increase in financial inclusion, as reflected in the surge of demat accounts over the past few months.
Q3. What should investors be mindful about before making financial decisions, in this dynamic environment?
Investors should be aware of market volatility. Elections, trade policies, and global conflicts can significantly impact markets. Don't let short-term fluctuations influence your decisions. Economic indicators like inflation, interest rates, GDP, and employment provide insights into market conditions and future trends. Regulatory changes can also play a role in how the market shapes up. Know your risk tolerance and investment horizon. Align your investments with your goals and time frame. Research thoroughly before investing, understanding asset fundamentals, growth potential, risks, and portfolio fit.
Q4 How is Shoonya creating a difference in brokerage industry?
Shoonya is rapidly becoming one of India's fastest-growing brokerage platforms by leveraging several key factors. Its true zero-commission trading model eliminates all trading fees and commissions, making it a cost-effective option, especially for new investors and those with smaller portfolios. It also reduces the learning cost, giving new investors an edge and helping them kick-start their financial wellness journey.
Being a Clearing and Trading member, the cost to trade for retail investors is lowest with us. We offer around 16 services that are completely free of charge. We have absolutely no fees or any hidden charges for basic services like account opening and account maintenance - amongst others. Users don’t end up paying for every transaction they make. This is what sets us apart.
Our focus on technology, featuring user-friendly mobile apps and online platforms, caters to India's growing tech-savvy population, particularly in tier-2 and tier-3 cities. Our data-powered signal-based analysis on the platform helps users navigate complexities and make informed decisions to enhance their portfolios. These features were available mostly for hedge funds or institutional investors globally but now are available for the retail investors in India. Our AI focused plan shall create the next level of financial inclusion and be useful for investors & traders.
Q5. How is the company leveraging utilization of data-powered, signal analysis in empowering investors/traders in wealth creation?
We have partnered with I Know First - a data-powered, signal-based analysis feature that provides valuable guidance to investors. Shoonya’s unique selling proposition is leveraging technology to democratise trading and assist investors in making informed and strategic decisions.
Shoonya offers access to data-driven signal analysis for 1,500 Indian scrips, including large, mid, and small-cap stocks, along with predictions for key Indian indices from NSE and BSE.
Our deep learning algorithms generate colour-coded signals, making market analysis straightforward. Each analysis includes a confidence indicator, clarifying the reliability of stock forecasts, added Virk.
The platform also generates instant heatmaps for stock market forecasts across various time ranges and enables portfolio monitoring, allowing investors to optimise their portfolios with daily AI predictions.
Q6. What are the company's growth plans with respect to technology evolution and enhancement of AI utility?
Shoonya is a tech company that happens to be in finance. Based on this philosophy, we focus on building our tech in-house. We prioritize ease of market access, wealth creation and empower investors using technology. With a swift onboarding process that takes less than five minutes, users can effortlessly open their accounts on either the Shoonya app or website. To safeguard user privacy and security, Shoonya employs a robust two-factor authentication system that requires both biometric and TOTP (time-based one-time password) verification. This multi-layered approach ensures secure access to accounts. Once registered, users gain access to Shoonya's comprehensive multi-asset platform. From a single screen, they can seamlessly trade and invest in a diverse range of financial instruments, including stocks, derivatives (futures & options), currencies, commodities, mutual funds, SIP, bonds, and ETFs. Looking forward, we are building new AI-based cognitive, predictive, and generative solutions for a range of asset classes. The project is still in the development stage, Shoonya holds an NBFC licence and is committed to developing new financial products and solutions that will further enhance the retailers’ experience.
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