India stock market

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aroominyork
aroominyork Posts: 2,827 Forumite
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I would appreciate some views about the Indian market. When I started DIYing a few months ago I decided to be overweight in Europe and India, the latter due to a stable, business-friendly and anti-corruption government having been elected (and, I guess, because I have a soft spot for the country). So I invested 4.5% of my portfolio in Jupiter India and 4.1% in ANII.

I now think I missed the last boat and have boarded too early for the next: the market rose strongly on the back of Modi’s election but it is now getting to terms with GST and remonetisation and I don’t see the market going up much (falls seem more possible) until these changes start to feed through into hard improvements in output and profitability. So I am today selling Jupiter India (SME) to invest in a broader EM fund, probably TEM, and for the moment am holding onto ANII (large cap). But since I see little upside but potential downside over the next couple of years I wonder if I should even hang onto ANII or take the small loss and wait until I think India might be ready for another spurt. Views would be welcome.
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  • Linton
    Linton Posts: 17,172 Forumite
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    There arent any boats to be missed or boarded. What matters is the long term. Choose a % allocation you are prepared to hold and stick to it. By keeping the % allocation constant you will automatically be buying when prices are unusually low and selling when unusually high with no need for prophetic powers.
  • A_T
    A_T Posts: 959 Forumite
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    aroominyork wrote: »
    When I started DIYing a few months ago I decided to be overweight in Europe and India, the latter due to a stable, business-friendly and anti-corruption government having been elected

    remember this is India and everything is relative
  • aroominyork
    aroominyork Posts: 2,827 Forumite
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    edited 5 October 2017 at 3:52PM
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    A_T wrote: »
    remember this is India and everything is relative
    True, but the changes Modi is pushing through are pretty radical and people I talk to there say he is genuinely committed to them. Congress (I) is a mess of a party, so looking to the next ten years I think political and economic stability is more likely in India than in the UK!
  • greendoor665
    greendoor665 Posts: 126 Forumite
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    You seem to be making quite a few finger in the air judgement calls which may or may not turn out right. You've decided to go overweight India which is fine, but now just a few months later you're reading all the various political and economic news stories about India, trying to analyse them, questioning your decision and changing your strategy.

    Why not stick to your strategy for a longer time period and resist the urge to tinker around and second guess the market. Only time will tell if your strategy works or not and so far it's been far too short a time period. By buying and selling funds more regularly you make it more likely that your returns lag the market.

    Personally I couldn't be bothered going into the amount of detail and research you're going into for just 1 country which by market cap is quite small, and one which has more than its fair share of corruption.
  • bostonerimus
    bostonerimus Posts: 5,617 Forumite
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    My view is that worrying about returns in the short term is a fast way to heart trouble and that trying to time the market is a fools game. Get an asset allocation that you can live with for the long term and don't chase return.
    “So we beat on, boats against the current, borne back ceaselessly into the past.”
  • aroominyork
    aroominyork Posts: 2,827 Forumite
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    As you say, Linton and bostonerimus, I am trying to get an allocation I can live with. My initial hunch to put a fair chunk into India before thinking about other emerging markets was flawed. This thread is me thinking about whether to keep some India or dump it all and I was/am hoping to get some other perspectives about the country to help me formulate my thinking.
  • bostonerimus
    bostonerimus Posts: 5,617 Forumite
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    edited 5 October 2017 at 7:06PM
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    This is why I advocate a simple market cap approach. The more complex the asset allocation the more second guessing and worry about when to get in or out sell or buy or adjust things on news reports of a vague change in the wind.
    “So we beat on, boats against the current, borne back ceaselessly into the past.”
  • A_T
    A_T Posts: 959 Forumite
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    aroominyork wrote: »
    As you say, Linton and bostonerimus, I am trying to get an allocation I can live with. My initial hunch to put a fair chunk into India before thinking about other emerging markets was flawed. This thread is me thinking about whether to keep some India or dump it all and I was/am hoping to get some other perspectives about the country to help me formulate my thinking.

    I am invested in EMIM. It has an allocation of India.
  • aroominyork
    aroominyork Posts: 2,827 Forumite
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    bostonerimus wrote: »
    This is why I advocate a simple market cap approach. The more complex the asset allocation the more second guessing and worry about when to get in or out sell or buy or adjust things on news reports of a vague change in the wind.
    Understood, and your views about Vanguard have been firmly taken on board. I am keeping a monthly record of my portfolio's progress and am comparing it to VLS60 and VLS80. After a year I will decide whether to stay active or go passive.
  • bostonerimus
    bostonerimus Posts: 5,617 Forumite
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    edited 5 October 2017 at 8:45PM
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    My comments are applicable to an active portfolio too. Whether you use active or tracker funds you should set an asset allocation that allows you to sleep and night and not think about tweaking on bits of economic news or on short term market movements. Let your active funds do the active investing......don't go buying and selling within your portfolio in an effort to time the market......that way madness lies.
    “So we beat on, boats against the current, borne back ceaselessly into the past.”
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