DEVINA MEHRA
![Cutting exposure to capital goods, industrial; waiting for IT to bottom out: Devina Mehra](https://img.etimg.com/thumb/msid-109810004,width-100,height-75,resizemode-4/markets/expert-view/cutting-exposure-to-capital-goods-industrial-waiting-for-it-to-bottom-out-devina-mehra.jpg)
Cutting exposure to capital goods, industrial; waiting for IT to bottom out: Devina Mehra
Devina Mehra of First Global reflects on the market's consensus shift towards capital goods, emphasizing the need to monitor potential sector peaks. She also discusses stock market volatility, election impact, and risk management strategies for smallcap stocks. Mehra says: "We have added a few commodity stocks in our last rebalance -- some amount of metal, steel, etc, and even some cement."
![Why following successful investors may set you up for failure - Part 2](https://img.etimg.com/thumb/msid-109340551,width-100,height-75,resizemode-4/markets/stocks/news/following-your-stock-market-heroes-may-not-always-pay-off-heres-why.jpg)
Why following successful investors may set you up for failure - Part 2
The most successful outliers on Dalal Street or for that matter, Wall Street over any given short-term period almost always took some extreme amount of risk that just happened to pay off big.
![Devina Mehra's portfolio tips: Avoid the big losses, avoid a big hit to your capital & then you will win](https://img.etimg.com/thumb/msid-108810050,width-100,height-75,resizemode-4/markets/expert-view/avoid-the-big-losses-avoid-a-big-hit-to-your-capital-then-you-will-win-devina-mehra.jpg)
Devina Mehra's portfolio tips: Avoid the big losses, avoid a big hit to your capital & then you will win
Devina Mehra warns investors about smallcap crash risks during euphoria. Emphasizes careful stock selection and managing risk to avoid losses. Advocates for cautious approach in volatile markets for better returns. In case of industrial, Mehra says: " I expect, sometime this year, maybe the story will be over. Of course, we have trimmed, we have changed stocks and we have done all of that but we are still overweight in that sector as we speak."
![Never put much faith in FII flows; remain overweight India in global portfolios: Devina Mehra](https://img.etimg.com/thumb/msid-107616284,width-100,height-75,resizemode-4/markets/expert-view/never-put-much-faith-in-fii-flows-remain-overweight-india-in-global-portfolios-devina-mehra.jpg)
Never put much faith in FII flows; remain overweight India in global portfolios: Devina Mehra
Devina Mehra discusses the underperformance of banks in recent years, attributing it to negative surprises and credit risks. She advises caution when investing in banks and mentions being skewed towards public sector banks. She also highlights the importance of assessing credit quality in banks.
![ETMarkets PMSTalk: How First Global turned Rs 1 crore to 2.57 crore in 3 yrs, Devina Mehra decodes](https://img.etimg.com/thumb/msid-107413679,width-100,height-75,resizemode-4/markets/expert-view/etmarkets-pmstalk-how-first-global-turned-rs-1-crore-to-2-57-crore-in-3-yrs-devina-mehra-decodes.jpg)
ETMarkets PMSTalk: How First Global turned Rs 1 crore to 2.57 crore in 3 yrs, Devina Mehra decodes
In India, we went through a whole decade 2010 to 2020 of below-normal market returns. Rs.100 invested in 2010 went up to only Rs.230 in 10 years in contrast Rs 100 invested in 1980 went up to Rs.700 by the end of the decade.
![Predictions for 2024: Little risk of a big crash, but tread safely on D-St, says Devina Mehra, First Global](https://img.etimg.com/thumb/msid-106425011,width-100,height-75,resizemode-4/markets/stocks/news/predictions-for-2024-little-risk-of-a-big-crash-but-tread-safely-on-d-st-says-devina-mehra-first-global.jpg)
Predictions for 2024: Little risk of a big crash, but tread safely on D-St, says Devina Mehra, First Global
Indian equities have been far below the 15-16% average compounding for years. In 2010-20, the compounding was only 8.8% — barely above fixed deposit returns. A Rs 100 investment would have become Rs 230 over this decade. Contrast this with Rs 100 invested in 1980 that would have become Rs 700 over a decade.
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Strictly limit your exposure in smallcaps, IPOs and microcaps: Devina Mehra
Devina Mehra say: “There are enough places in the market to make money. So, be cognisant of risk management. Smallcaps, IPOs, microcaps, the areas where there has been a lot of exuberance of late are exactly the areas where you have to be careful of and strictly limit your exposure.”
Probability of a market crash is still low; be cautious on smallcap side: Devina Mehra
Devina Mehra says: “We want to track the FII flows is because we think it determines the direction of the market. But if you actually look at data over years, over months, whatever cut you want to take, the FII flows have very little correlation with the market movement, in fact, none at all. I mean, this was the case even when the domestic mutual fund and the domestic retail investor community was not that large. ”
22 multicap PMS funds give double-digit returns of up to 24% in a month; outperform smallcaps
Credent Asset Management’s Growth Portfolio multicap strategy topped the list, giving 24.3% returns in a month, according to data shared by PMS Bazaar.
Equity markets will not give equal returns every year: Devina Mehra
"If you had put in Rs 100 in 2010, you would have got only Rs 230 in 2020, barely beating FD returns for that period. So you came so far below the trend line that you are still not anywhere close to the trend line. The big crashes come when you are way above the trend line. So that is not happening."
Be careful in small and midcaps; even a 5% index correction may mean 20% fall in individual stocks: Devina Mehra
“People forget history and how long these pockets of the market can give you pain. If you look at 2008, after the crash, that level came back to the small cap index in 2016. There was a brief bull run in the middle. Again from 2018-20, there was a 65% correction which meant that 90% of the stocks were down more than 50%. “
PMS Tracker: Sunil Singhania's fund tops gainers' list, gives 12% return in July
Several multicap funds gave double-digit returns last month, with Karma Capital Advisors’ Wealth Builder multicap strategy giving more than 10% returns. It has been a consistent
India will outperform and here are 3 sectors where weightage has gone up: Devina Mehra
"India had a very long period of underperformance in the 2010-2020 decade when we were far below the trend line. Instead of that 15-16% compounding that was expected, we compounded only 8% odd at a time when fixed deposit rates were 7-8%. We were far below the trend line. That is why once the revival came post Covid , I expected it to last long as the risk of a crash goes down because crashes come when the markets are far above the trend line."
Will HDFC Bank remain the Arnold Schwarzenegger of banks for next 10-20 years? Devina Mehra explains
“I do not expect a big stumbling block in the HDFC merger. Obviously, some of HDFC Bank’s ratios will get diluted at least in the short term whether it is the return ratios or even the growth percentage that would come down from where it has been with the merger of HDFC. Other than that, I do not see any big glitches coming up.”
PMS Tracker: 15 funds give double-digit returns in May as bulls' D-St party continues
Of the 15 PMS funds, 13 of them beat their benchmark BSE 500 index in May. Last month, the S&P BSE 500 index gave 3.5% returns.Some of the prominent names in this list are Carnelian Advisors’ multi-cap fund, Phillip Capital’s small- and midcap fund, Equirus Wealth’s smallcap fund, and Tulsian PMS’ largecap fund.
India definitely looking one of the better markets to invest in: Devina Mehra
Yes but the cash flow and profits are still far away compared to still the valuations that they have and I said just a while ago that for us risk management is priority so we are not in the business of taking punts, which play out basically on luck.
I don't think market up move is anywhere close to over: Devina Mehra
You can make a trade-off between passing on the decline in prices to the consumer and giving a boost to demand or having the margin expand or a combination of the two, in any case it will be positive.
ETMarkets Smart Talk: Message to investors – Don’t look for illusive multibagger in FY24 but focus on asset allocation: Devina Mehra
It was the very worst year in over 200 years in US bond history. For both US equities and bonds being down had happened only for 1 year in the Great Depression (1931), 1 year in World War 2 (1941), once in 1969 and then this was the first time in 50 years that this happened.
ETMarkets Smart Talk: Devina Mehra shares her mantra for spotting stock market winners
Crude has corrected substantially from the 2022 highs and since that determines the prices of a lot of downstream products, it can provide a cushion both to the economy, as well as to corporate earnings.
Crude is going to be the theme which will drive a lot of factors in Indian market: Devina Mehra
So if I look at the economy as well as corporate earnings, to my mind, that one theme which can change a lot of things is crude.
Fall in IT stocks a knee jerk reaction, not a disaster which will last forever: Devina Mehra
Tech is not a mature business in that sense that you will not see growth, again we are talking at a trough of a cycle in terms of the economies which they cater to. So, I do not think that is the thing that demand is going to dry up for IT.
Sitting it out is still more risky than being in the market: Devina Mehra
Devina Mehra, Founder and Chairperson of First Global, says Nifty 40-year return has been 15%. We are still not above the trend line and so the risk of a crash is limited. Still, the risk would be in not being invested rather than in being invested. So sitting it out is more risky than being in the market because at some point, you will miss out on a big upmove rather than the comparative risk of a crash from here on.
Risk management should come before return maximisation: Devina Mehra
I rather than talk about which specific companies today, I would say that risk management should be very central to whatever investing you are doing. I mean, certainly that is the way we do our portfolio and fund management which is that risk management comes before return maximisation.
Every investor should have reasonable part of their portfolio in global basket: Devina Mehra
The good part for people who have limited time to spend on the investing game is that most of your returns 80% to 90% come from asset allocation, not from stock selection.
Leadership has moved from US to Europe and other markets including India: Devina Mehra
“One can have an asset allocation attitude but I do not see outside its risks in equities just now and also sentiment is a contra-indicator. When there is uncertainty, when people think things are going wrong, the next period returns are above average. One just compounds bad decisions by going with the flow and how everybody is feeling.”
How Devina Mehra turned overweight from being underweight in banks
“The biggest overweight continues to be capital goods and industrial machinery where we have been overweight since October 2021, about 15 months now. That continues to be our biggest overweight and that has been a big winner. Other overweight sectors have really come from a bottom up stock picking. There might be textiles, a few chemicals, some auto components stocks.”
India in a sweet spot and may continue to outperform: Devina Mehra
“For our IT services companies, the fundamentals have not been as bad as what the stock performance appears to show. So yes, it has had but the point is that those are what we call tech companies in the US. Microsoft, Google etc are completely different from our services companies.”
Why Devina Mehra is bearish on fin tech companies
"I do not even try to predict FII flows into India let alone China so because I do not think that is a relevant metric to track ."
Should you raise allocation in midcaps and smallcaps? This is what Devina Mehra has to say
“It is not as if we do not invest in small and midcaps. We have capped that investment at a certain level, particularly in smallcaps because in smallcaps, the risk is when things go out suddenly, the liquidity disappears. We do not want to take those kinds of chances. That is why we will never be 40% smallcaps or something like that.”
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