At a time when markets are swinging between optimism and anxiety, the latest Investment Policy Committee note by ASK Private Wealth lays out a clear message: this is not the phase to chase returns—it is the phase to manage risk smartly.
The report, tellingly titled “From giddy to greedy”, signals a shift in investor mindset—from aggressive risk-taking to disciplined, multi-asset allocation
Start with the big picture: Risk has gone up, not down
The report highlights three key global risks—war, trade tensions, and foreign investor outflows (FIIs)—as the dominant forces shaping markets right now.
These risks are not theoretical. They are already:
-
Disrupting supply chains -
Keeping inflation elevated -
Pressuring currencies like the rupee -
More importantly, the report warns of stagflation risks—lower growth combined with higher inflation, a combination that is particularly challenging for investors.
What this means for you:
You can no longer rely on a single asset class (like equities) to deliver consistent returns.
Equity: Stay invested, but don’t get aggressive
One of the most important takeaways is the stance on equities: Stay neutral—not overweight, not underweight
Why?
-
Geopolitical risks remain elevated -
Corporate earnings may be impacted -
FIIs continue to withdraw capital -
Even though valuations have corrected, the report clearly says there is “no blood on the street yet”, meaning markets are not cheap enough to justify aggressive buying.
Where within equities?
Large caps are preferred due to better earnings-valuation balance
Small and midcaps have seen sharper earnings downgrades without equivalent price correction
What you should do:
-
Stick to large-cap heavy portfolios -
Avoid overexposure to speculative mid/small caps -
Don’t increase equity allocation just because markets dip slightly -
Look beyond India: Global exposure is becoming essential
The report makes a strong case for global diversification, especially in technology.
It highlights that:
AI-led companies globally have shown resilience
India alone may not offer sufficient exposure to these themes
What you should do:
-
Allocate a portion of your portfolio to global equities, especially US tech -
Use international mutual funds or ETFs for access
Fixed income: Surprisingly, not your safest bet right now
Contrary to traditional wisdom, the report recommends:
Stay underweight on fixed income
Why?
-
Interest rates are volatile -
Yield curves are steepening -
Inflation risks remain
Even though RBI has cut rates, bond markets have not responded positively due to:
-
External global pressures -
Currency concerns
What you should do:
-
Avoid long-duration debt funds -
Prefer short-term debt instruments -
Don’t over-allocate to fixed income expecting stability
EITs & InvITs: The standout opportunity
One of the strongest calls in the report is:
Stay overweight on REITs and InvITs
Why?
-
Rapid growth in real estate and infrastructure -
Assets under management already exceed ₹1 lakh crore -
Strong pipeline driven by capex growth
These assets offer:
-
Regular income -
Equity-like returns in some cases -
Diversification benefits
What you should do:
-
Increase allocation to REITs/InvITs via mutual funds or direct investing -
Use them as a hybrid between equity and debt
Gold: No longer a clear winner
Gold has been a strong performer, but the report has turned cautious:
Shift from overweight to neutral on gold
Why?
-
Rising volatility -
Weakening correlation with other assets -
Reduced predictability
What you should do:
-
Maintain gold as a hedge -
Avoid increasing allocation aggressively -
Keep it within 5–10% of your portfolio
The real strategy: Multi-asset investing is no longer optional
The data shows:
-
Multi-asset portfolios reduce drawdowns -
They deliver smoother returns across cycles -
No single asset class consistently outperforms
Even correlations between assets are:
-
Changing -
Sometimes turning negative
What you should do:
-
Build a portfolio across: -
Equity -
Debt -
Gold -
REITs/InvITs -
Rebalance periodically -
Avoid concentrated bets
Sectoral opportunities: Where growth still exists
Despite caution, the report identifies pockets of opportunity:
-
Financials remain fundamentally strong -
PSUs still offer value -
Defence, commodities, and metals benefit from global disruptions
What you should do:
-
Focus on sector leaders, not speculative plays -
Prefer diversified funds over direct stock picking unless experienced
While individual portfolios differ, the report’s model stance suggests:
-
47–48% equity (neutral) -
20% fixed income (underweight) -
~17% hybrid/multi-asset -
8–9% REITs/InvITs -
15% commodities (including gold) -
Diversification is now the strategy—not an afterthought
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