Today, everybody seems to be interested in the stock market. It looks like this is only viable investment option available for all!
Right from a 23-year old who has just started earning, to the housewife who manages to save some household money, to the retired army personnel, almost every single person wants to put money, only and only in the stock market.
The simple truth is – despite the pandemic it looks as though it is only the stock market which seems to be working fine, with a sense of optimism on most days. And on a realistic note, the returns from the FDs is simply not lucrative enough; it simply does not extend the value of your money any longer. Gold is not an option for most and realty, well, not everyone has enough to buy; there are many in this new crop of retail investors who want to make money in the stocks and use the money to buy a house even!
Actually, it’s a very ironic situation in the country right now. The pandemic has made a mockery of our entire talk about Atmanirbhar as we are currently getting so much aid from all around the globe. But on the stock markets, we see the Atmanirbhar theme playing out – FIIs are scooting while it’s this new generation of retail investors who are driving the markets now. The vocal for local stands failed currently on the economic front but on the bourses, that’s what is working!
Even the domestic institutions are all for the market. Take a look at these numbers which tells us this truth – FIIs have been net sellers to the tune of Rs.8600 crore so far this month while domestic institutional investors or DIIs, which comprises of mutual funds and insurance companies have been net buyers to the tune of Rs.10,000 crore.
The surplus money in the hands of the young and yuppies, plus the work-from-home culture has given rise to this brand-new generation of investors; they have tasted blood and they are here to stay.
And if you look at the list of top gainers and losers on the bourses, we find that majority of the times, they are all mid and small cap stocks. This is again a pointer to this new crop – these retail investors prefer mid-cap and small-cap stocks are their perception is that large-cap give steady but slow returns. These are the ones who had put many beaten down small and midcap stocks back into the reckoning. Yes, there are many who have been trapped into penny stocks and even in some established stocks, following the advice of vested interests. They lost hefty amounts of money but took it as money paid to learn an important life lesson in investing.
The good news here is that these are not ephemeral investors – here today, gone tomorrow. They seem to be here for the long haul.
The pandemic has taught all of us very significant life lessons, some bitter and some sweet. But for these millennial investors, this has been a wake-up call, urging them to save and invest. And for our markets, nothing could have been better than this.