The Indian equity benchmark indices continued to make new highs and ended CY19 near all-time highs on the headline benchmark indices. The broader market i.e. midcap and smallcap index have also started to gain some momentum, and are participating in the recent market rally. For next year, ICICI Securities expects equity markets to be structurally well placed from a medium-long term perspective and recommends only investing in multi-cap funds.
The brokerage said, "Midcaps/small caps are likely to outperform. While the Sensex has regained its all-time high levels, midcap and small caps remained well below their peak levels. Low-interest rates, an expected recovery in the second half and continued government measures are likely to revive sentiments in the broader markets."
Multi cap Funds witness highest monthly inflows
ICICI Securities recommended multi-cap funds instead of equity or hybrid funds because it offers fund managers the flexibility to allocate funds across all market segments.
However, in the case of equity funds, the firm warned its investors to be extra cautious in investing in funds that have done well in the last year as a sector. Hybrid funds witnessed outflows as investors booked profits after the rally in equity markets.
The government believes that positives like support for real estate and allied sectors, accelerated government spending to release liquidity, lower interest rate, and easy global liquidity will all help revive India’s sluggish growth, the report added.
First Published: Dec 25, 2019 2:03 PM IST
