Why retail investors remain confident
Experts say the continued inflows reflect a disciplined long-term approach among retail investors.
Navy Vijay Ramavat, Managing Director at Indira Securities, noted, “Even a year of muted returns does not immediately impact investor sentiment. Recent market corrections have eased valuation pressures, and investors with higher risk appetite are comfortable riding out volatility.”
He highlighted that the ongoing results season shows signs of bottoming out in the earnings de-rating cycle, which supports continued investor interest.
“Small caps carry high risk but also high return potential. Long-term investors are willing to navigate short-term fluctuations,” Ramavat explained.
Focus on long-term wealth creation
Ramavat emphasised that frequent trading can erode returns due to brokerage, STT, and GST costs. He recommended systematic investment plans (SIPs) and focusing on a few high-quality funds.
“Crowd decisions are emotional; yours should be logical. Avoid crowded trades unless they fit your investment system,” he said.
Diversification and strategic rebalancing
Maintaining a diversified portfolio across small-cap, mid-cap, large-cap, and hybrid funds is key to navigating volatility.
Rebalancing should align with personal goals, risk tolerance, and investment horizon rather than short-term market movements.
“History shows small and mid-cap underperformance can precede significant future gains. A long-term plan generally delivers steadier outcomes,” Ramavat added.