Investment Tips: Shankaran Naren, CIO of ICICI Prudential AMC, says that at present gold has seen a rise due to low confidence of the global market towards governments, especially America. The bullishness caused by such fear is not sustainable. Speaking at the Morningstar Investment Conference in Mumbai on November 4, he said that while he is in favor of investing in gold, it would be advisable to prefer a multi-asset strategy rather than just investing in gold.
He said, “I don’t think there is much scope for investing in gold and silver alone, apart from multi-asset funds. If you don’t trust governments, that’s a different thing. For example, if you don’t trust the US government, then you can invest some money in gold and silver. If that’s not the case, then it would be better to invest money only in multi-asset. At this point in time, gold and silver are basically anti-government investments.”
Focus on multi-asset investment strategy
He further said that gold and silver have seen a period for a decade in which their movement has remained flat. Therefore one has to be very careful regarding these. He believes that at some point America will deal with its problems. Therefore, it would be advisable not to invest in gold and silver alone right now. At this time the focus should be only on multi-asset strategy, because at some point of time governments will find solutions to their problems, then there will be no returns in gold and silver for a long time.
There is no bubble like situation in our market
Talking about the Indian market, S Naren said that there is no bubble like situation in our market. Our market is a mature bull market where there are many good themes and sectors to invest in. “We buy when investors get frustrated and eventually exit after not getting any returns for years,” he said. At this time, we can see many such opportunities in sectors like financial, consumption, capital goods, metal and oil and gas.
The immediate risk for Indians is not domestic, but keep an eye on global events.
According to Naren, the biggest risk to markets over the next decade is how US AI stocks will fare. AI will decide the future direction of global markets. We may see moderate returns in India going forward. Asset allocation is the best way to invest. The immediate risks to the Indian market are not domestic; we may be shocked only by global events.”
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