Their is Panic after the Euphoria. And equity markets are close to making a panic bottom in the next few days. In January 2008 nobody in the world would have told the Investors to book profits, similarly nobody is now telling the investors to buy into equity. The final panic signs are evident in the markets. With the rejection of US bailout package, world markets are in a state of panic, because of the liquidity crunch. These are clear signs of the markets bottoming out after a free fall.
Fortune favours the brave. Only those who will venture out in these turbulent times with their shopping bags will reap rich rewards in the future. It has happenned in the past, this time around there won't be an exception. At around 12000 BSE, the risk reward ratio is positive, as the markets trade at 12- 12.5% FY09 PE multiple. Anything lower than that is your bonus. The brave have to make a choice in favour long term investment. It is the right time to increase exposure to equity in your portfolio, because equity has always been a good long term bet.
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