Money Money Money: 2019 has been a volatile year for fixed income and equities

This is our final personal finance episode for the year 2019. what a year it has been so many learnings, rollercoasters in the market whether you are looking at equity or fixed income, change in regulations, and more choice for investors, more learnings and learnings are never a bad thing.

To look at everything that has happened last year 12 months and more importantly to look forward to what 2020 might have installed for your wealth, my wealth and all our well-being Surabhi Upadhyay is joined by NS Venkatesh, Chief Executive of AMFI and Nimish Shah of BNP Paribas Wealth Management.

Talking about throwback 2019 NS Venkatesh said, “It has been a tumultuous year, in the sense that lots of regulatory changes have happened. In the mutual fund industry, most of the regulatory changes have happened on the risk management side because of a few defaults which we saw in some of the debt mutual funds. In addition to that, these are all regulatory changes for protecting the investor’s interest.”

Nimish Shah said, “It has been quite a volatile year both in terms of fixed income and equity. The overall financialisation which has happened in the industry apart from that the transparency which has come in the implementation of GST, all that has actually impacted and we are seeing the economy is faced with slow growth prospects not only for 2019 but probably going into 2020 also.”

Speaking about MF equity flows have cooled off Venkatesh said, “This phenomenon is not peculiar to this year, whenever the markets are high you will see the investors taking the profits off the table by redeeming the investments in the equity space in the mutual fund industry so this is nothing new.”

While talking about the outlook for equity funds in 2020 Nimish Shah said, “What remains fundamental is in terms of the search for quality and quality always comes at a price both in large-cap and midcaps. The carnage that we have seen in the midcaps and especially small-caps in September 2018 actually gives a lot of space for valuation - buying good value buy as well as midcaps and smallcaps are concerned."

He further added, “We would kind of right now recommend more of multi-cap funds for 2020 and focus on also a lot of opportunities available on the midcap and smallcap.”