Most panellists at the ‘Equity Outlook- 2009’ discussion hosted by ET Now, ET’s upcoming business news channel, were of the view that the stock market would be range-bound, and 2009 would most likely end at 8,000-8,500 for the sensex.

The only silver lining, if one can call it that, was the near consensus that India would be among the first to come out of the slump and that the stock market would look up much before the real economy turned a corner.

There was, however, no consensus on when that turnaround could happen, though some expected the outlook to improve in early 2010 but warned things might get worse before they got better. Clearly, equity investors face difficult choices.

Though, equities offer a promise of decent gains over a three-to-five-year horizon, in the short term, there are significant risks. There would be many 20-30% bear market rallies, one of which, hopefully, would eventually turn into a sustained stock market upturn.

If an investor chooses to wait for a definite revival, she is sure to miss out on the initial part of the rally. On the other hand, if she invests in this volatile market, the returns could be flat or, in the worst-case scenario, suffer an erosion that could be as deep as 20% from the current levels.

source: Economictimes

Tags: calls, daytrading, free calls, intraday, tips

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