What is your sight? Eagle or Snake?
Our ancient scriptures have given a beautiful example of
Garud drishti (Eagle) and Sarp (Snake) drishti
Lord Vishnu to which goddess Laxmi (wealth) is attracted is
seen in 2 postures! One is seated on snake and one riding on Garud.
Garud and Snake drishti has any relevance in Investing?😑. Yes it has and that is why I am writing this
blog.
Eagle can fly high and can have wider and helicopter view
whereas Snake being a serpent can only see what is available at the eye ball
level alias what is visible nearby.
I want to relate the analogy to the Investing. And believe
me, it matches well 😄👍
Equity Investors are required to have Garud drishti – Long
term view. That helps them to create huge wealth. But having said that, Sarp
drishti is equally important. If one is seeing the pain in economy and
corporate profitability growth, he must quickly reach out to his financial
consultant and discuss about the strategy to take advantage of the markets.
Sapr drishti helps in re-aligning portfolio which will prove
to be relevant to market in times to come. Here investor redeems some part of
profits and takes gain home. In Gujarati we have saying “Nafo chopda par nahi, ghar ma
aavo joeye” meaning profits should not lie in books alone, we must bring it
in Bank also.
Garud and Sarp
drishti is performed by every investor at the same time, therefore which sight
to use and when to use it also important👍
Let’s take current situation, we are aware that world
economies are going thru tremendous pain of Covid 19 related lockdown and
disruptions but still equities are scaling newer highs. Only bright side is
huge liquidity pumped in by central Banks. And another one could be TINA factor
in assets. With Bonds at abysmally low yields and gold at historical highs,
equity looks only place to be in. Properties across the world are still not
viewed as better than equity. I don’t think another 3 yrs will be any good for
house or office space. USA is seeing sharp increase in “For Sale” billboards
outside apartments. Investors realised that property involves large sum of
money, taxes, transaction cost and poor liquidity. Therefore equity will remain
preferred choice. Its anybody’s guess, how long party in stock markets
continues. Good part of data suggests that trading volumes have gone up from
first time investors, retired people and home bound people who are taking
trading as tool to kill time (Hope they don’t kill their wealth, in bargain).
So new entrants are seeing rally in market and buying equities to create
wealth. Whereas at the same juncture, Wise investors are reducing equity (Sapr
drishti) and reallocating to equity in staggered fashion (use of Sapr drishti
with eyes of Garud also).
In such a scenario, we are
advising investors to reduce weight in equity and keep gun powder dry (Sarp
drishti). Complete exit from equity can have consequences in any market cycles (Garud
drishti).
Within equity allocation also, Investors put their money where
the returns have been great in past few yrs. Such calls mostly turn out to be
Sarp call. Few examples of Sapr drishti currently are as below. I am not
suggesting that below aren’t Garud calls, but are certainly not good bet given
the current valuations.
1)
US Tech companies
2)
Assured returns Insurance policies
3)
ETFs
4)
Large caps
5)
Healthcare sector
6)
Gold
7)
Debt funds
Do you know Garud calls for the next few years?? Do write to
me @ wealthcarein@gmail.com or
WhatsApp me @ 9833778887
Bhavesh Damania I Founder and Chief Care Taker-
Wealthcare Investments I Personal Finance Guest- CNBC TV
18, CNBC Bajaar, Outlook Money, Mint I Blogger
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