Long and Short of Markets: Optimism trumps fundamentals & other top reads

By Atul PM

Benjamin Graham’s pearls of wisdom - “Buy not on optimism, but on arithmetic” - seems like pessimism today. In this liquidity-fueled market rally, the truth behind the dream run is hope and optimism about the future discounting current reality. The ETMarkets Diwali Survey showed greed has now overpowered fear on Dalal Street. Read this and more in this weekend's edition of 'Long and Short of Markets'.

‘El Dorado’ of Dalal Street
For long-term investors, underdogs of today can turn out out to be goldmines of tomorrow. According to AMFI's stock classification, around 20 smallcaps graduated to largecaps in the last 10 years. Warren Buffett had Apple, Rakesh Jhunjhunwala had Titan as their dark horses, what will be yours?>>


When optimism overrides fundamentals
A survey conducted by ETMarkets shows that the market is in the ‘greed’ zone by looking past the present on hopes of Covid vaccine and better-than-expected earnings. But investors should realise that arithmetic and fundamentals are their most reliable friends in the market.>>

‘Anda’, ‘Sabzi’ are thorns in RBI’s shoes
RBI’s most formidable weapon to control liquidity is interest rate. But with the retail inflation looming over the comfortable zone of 7.6 per cent, it seems like the central bank has to lay down it's Brahmastra, forcing the government to spend more to keep the economy afloat.>>

Bluechips better in a punctured economy
With the economy entering into an uptrend cycle, a lot of underperforming stocks might seem like value bets. This Dalal Street veteran warns against venturing into volatile cheaper stocks.>>

Avoid cyclicals with the economic recovery storyCyclicals may be one of the better bets to ride economic recovery, but the broader risk of revenue drop and uncertainty can never be discounted. This market expert argues that it is better to go with steady growth companies in IT, pharma and others, instead of cyclicals.>>