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Let there be no doubt that the ongoing rally in India is driven in a massive way by a surge of inflows from Foreign Institutional Investors (FIIs). Participation by mutual funds and insurance companies has paled in comparison. As a result, this market has been beneficial for speculators, traders and high-risk taking retail investors.This pattern is no different from what we have witnessed in the past in India. FII flows have recovered by about $ 10 billion from the lows of 2009. They had been net sellers of Indian equities to the extent of about $ 2.5 billion by mid- March,taking equities to a low for the year.Inflows from FIIs since then has been on an upward trend and is approaching $ 9.5...
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Narayan Seetharaman Thathai
| Commented
| 2 years ago
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Agree fully with the article. The recent drive in asset prices could see a reverse turn on liquidity dry up, tightening of intt rates on the back drop of increase in inflation. For India, the inflation could spiral especially in the back drop of a...
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Padmanabhan R
| Commented
| 2 years ago
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Nice work sir thanks for sharing , yes extra liquidity can heat up discrepancies in valuation to alarming levels if goes unchecked and later correction will dry up liquidity to grave levels. Easy credit and good return will attract speculators.
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suchita Ambardekar
| Commented
| 2 years ago
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Wonderful article ...and a very keen observation.....Vaidya, This means the that whole of this century we will be facing one bubble after another.This also means that in principally, the flow of the money into an asset class will give rise to a...
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Insight: "Play the liquidity-driven rally with care" deleted from your view.
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