“There might be some ups and downs until December 3, especially with the state election results coming in, but after that, I expect a pre-election rally in the market."
“The 20-week average for the Nifty Smallcap Index is close to the 12,000 mark and we currently are at around 12,500. That is another 500 points lower for the Nifty Smallcap Index. So, we are not done here. In fact, the smallcap index has corrected slightly less than the midcap and so there is still more room for the smallcaps to correct relative to midcaps.”
These are innovative firms, with positive cash flows, and a steady business model, that are under-researched and under-owned, thus offering an opportunity for growth, says Mehta. He advises 10-15 percent allocation in smallcap mutual funds.
Markets are positively positioned with strong macro growth and corporate earnings growth, plus valuations, though above average, are not overstretched, says Alok Agarwal of Alchemy Capital.
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