Why you should buy Equity Shares:

In the recent times Indian Stock Market has witnessed two distinct phases.One is the scam period of 1992 which saw share prices rise to dizzy heights but fell down as rapidly wiping out many a fortune or saving. Then there was the post scam boom of 1994 which took the index over 4500 points, due to a spate of FII investment and a flurry of quick rise new issues. The market went limpid since then, falling steadily, under an over regulated SEBI period which removed speculation under the form of "Badla".

Looking back it seemed that SEBI and the Finance Ministry seemed to be convinced that a deluge of foreign investment was in the offing and a pre- election strategy of money supply and inflation control took hold. The Mexican economy's debacle and a sudden rise of US stocks, especially technology based ones put paid to those expectations. Fresh FII investment dwindled to practically nothing. Expectations of the re-introduction of Badla and the depository system again brought about a short rally but it was short lived - what with the UTI- Reliance rights placement, the MS shoes scandal, Enron and other FDI related issues. More than anything, it was the political uncertainty brewing within the Congress and the threat of a hung, post election parliament. The last straw on the camel's back was the PSU disinvestment failure which failed to ease the real squeeze on money supply. And now, it is the Hawala issue and the rupee fall. At the moment, most of the problems like Badla, depositories and Enron seem to be getting ironed out. The falling rupee is an economic issue which will have to be managed by our economic mandarins or it will eventually work it's way out in the foreign exchange sensitive sectors.

Among all these dark happenings there is a silver lining- it is for all to see (especially the FII's who are the prime movers of the market now) -that we have a functioning legal system (Enron,KFC etc.), a functioning democracy which is slowly turning transparent and established institutions and markets. The political uncertainty all of a sudden doesn't look too grave. According to most foreign emerging market pundits, India is the best emerging market BUY. And present stock market rally is because the FII's are taking a calculated risk on the post election scenario.

So our point is, are you missing a real opportunity ?

If asked the above question our straight forward reply would be : Yes, you should invest at least 25% of your funds now and more , if you have a high risk-return profile. There are various reasons:

• Major trend emerge after the periods of high volatility. It is now a well studied phenomena that the Indian stock markets undergo high volatility just before the elections. This is the time to take a calculated risk. Equity by definition is risk capital.
• Equity is the only real inflation hedge. The post election scenario is ominous in as far as inflation is concerned. It might very well be double digit inflation for quite some time. Even if you are the risk averse equity investor you have to invest a certain amount now provided you believe that the long term prospects (over three years) are good.
• There is a very distinct possibility that the post election political scenario will not only be tolerably stable, chances are for the economic prospects to be excellent. But by then FII buying would have taken stockmarket prices back to those high P/E levels.

Yes and No, even if we take into account the prevailing high interest rates that may be sustained for some more time.

• Yes, if you are absolutely risk averse.
• No if you think that your savings should also reap some of the benefits that results from liberalisation .
• No if you are concerned about inflation and the buying power of your savings.

If you are fully invested into fixed income securities like Fixed Deposits, debentures , bonds etc. this is the time to invest into equity upto 15% of your portfolio into equity - higher, if you can take on a higher risk.

• We feel that the real estate boom will fizzle out in less than three years. Till then it is a good investment if you can handle it.
• We are fairly sure that the time is imminent for gold prices to take a quick fall unless some real uncertainty builds at the global level.

Need For Personalised Service:

Investing exercise consists of two actions - selection and timing. Selection of a particular scrip can be made in many ways . Selection may be a difficult exercise considering the complexities of the times. The timing decision is equally important.

• You might not have the requisite resources for research etc.
• You might be unaware of the happenings.
• You might have certain queries that can be answered only by professionals in the field - professionals like us.
• Perhaps you might be a person with hectic daily schedule and having time constraints.

There is always an investment opportunity for the risk loving and the risk averse. To cash in these you need to have personalised service. Service synonymous to the name Amrok.