Ace investor Shankar Sharma of First Global has said that there are 4 easy ways to make Venture Capitalist-type returns in the stock market. Speaking at the Morningstar conference in Mumbai broadcast by ET Now, Sharma said that 80-90% of investing success is luck. Elaborating on his four mantras, Sharma said, “Firstly, I never wavered from buying trash companies at even cheaper prices. Secondly, a stock must be at multi-year low; look at negative momentum in stock. Thirdly, the stock should be loss-making or near loss-making and fourthly, the stock must be at lowest underweight in its own sector.” Sharma heaped praise on Indusind Bank and Amazon, saying management changes, cash turnaround helped the companies in a big way.
Last week, he said that he was not worried about 2-4% market correction after a big run, and also felt that bear market for emerging markets had ended. He was of the view that the market will go through the roof if yields come down to 5%. Stating that there is no correlation between policy rates and inflation in India, Sharma expects the new RBI governor to be hawkish.
Watch: Shankar Sharma At Morningstar Investment Conference
Recently markets guru Rakesh Jhunjhunwala had expressed optimistic that the direction of growth in India is upwards. “Earnings are going to grow in India. Bull markets start with low participation, but end with humongous participation.” “Don’t have emotions towards stocks. The idea is to make money,” Jhunjhunwala’s had said.
Benchmark indices were trading lower in late morning trade on Wednesday, as investors opted to book profit after Tuesday’s huge rally. However, losses remained capped with the report that the GST Council on Tuesday headed by Finance Minister Arun Jaitley discussed a four-tier rate structure suggested by the Centre and agreed on compensation to loss-incurring states for the first five years of the new tax regime.