Varun Manmohan Kapur

 Apart from growth, this enhanced market share provided a cushion against lock-downs, lowering demand during the pandemic, says Varun Manmohan Kapur.

This thesis is visible in the outsized returns over the last one year (during which there were 2 lock-downs) generated by these large private players with high market shares in their respective business segments (equity returns mentioned below exclude dividends):

Bajaj Finance – 95%
L&T – 79%
Asian Paints – 74%
Pidilite Industries – 71%
Titan Industries – 63%

Now market share is sticky, owing to the number of intermediaries involved and the ‘trust’ factor, once created gets difficult to displace in the short term. So large caps with large market shares in their segment’s pre-pandemic are expected to yield the benefits of such enhanced market share over the medium term. Certainty of cash flows, vendor payments, debt servicing, employee retention will all play to their benefit. These outsized market shares owing to the pandemic can throw off conventional valuation matrices like P/E, EV/EBITDA as ‘growth’ (despite their already large base) is expected to be high and disproportionate to levels of economic recovery over the medium term.

Varun Manmohan Kapur

This got further exacerbated in the backdrop of the pandemic, smaller companies with their lower levels of resilience and limited sources for raising financing resulted in positive economic outcomes for larger players. Their already high market shares got a further fillip as suppliers, distributors, financiers, customers all resorted to ‘safer’ and ‘trusted’ brands. Apart from growth, this enhanced market share provided a cushion against lock-downs, lowering demand during the pandemic, says Varun Manmohan Kapur.

This thesis is visible in the outsized returns over the last one year (during which there were 2 lock-downs) generated by these large private players with high market shares in their respective business segments (equity returns mentioned below exclude dividends):

Bajaj Finance – 95%
L&T – 79%
Asian Paints – 74%
Pidilite Industries – 71%
Titan Industries – 63%

Three Safe Types of Investments

Everyone longs to get that something, anyway little, that will undoubtedly be productive a while later. Innovation and the unique market have achieved various venture openings. In any case, you can't estrange yourself from the dangers implied in most, if not a wide range of ventures. Consequently, tracking down an appropriate road to stash your money ought to be your main concern to limit prospects of a misfortune. There are 3 safe sorts of speculations and they are as per the following. 

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Ownership of property

Up until now, this is the most productive and most secure endeavor worth your thought. For instance, turning into a business visionary and setting up your own business is probably going to be beneficial. Concocting labor and products that are looked for by many individuals will acquire enormous additions on your part. Bill Gates is an encapsulation of genuine business. It additionally takes something beyond cash to achieve your objectives in organizations. Different characteristics like tolerance, great client relations, and trustworthiness are needed to acquire individuals' trust. Land is another possession that you can change into a lucrative undertaking. What's more, land is another structure since its worth has at any point appreciated. Individuals, particularly those coming to urban areas need sufficient lodging and this is certainly a rewarding road. Stocks additionally fall under this class and they guarantee you reserve a privilege to part of an organization and if its worth builds, you can profit in the event that you decide to sell. Different properties like artistic creations or melodic pieces can be useful.

Crediting ventures

This kind of venture doesn't imply high dangers like possession ones consequently not as worthwhile. Here you will go about as a bank. An organization gives a bond, which pays a specific sum for a specific period. In that timeframe, the loads of an organization can increment fundamentally up to twice or threefold. Subsequently, you will pay for the bond and also get some huge increases. Dangers and benefits rely upon the sorts of bonds included. They change from speculations from CDs to worldwide obligation issues.

Speculations equivalent to cash

These are those that can be effectively changed to cash if the need emerges. Here the dangers are insignificant yet so are the advantages. Be that as it may, they merit thinking about particularly in case you are not the forceful sort. An illustration of this is Money Market Funds, which are more fluid than different ventures. A few group likewise believe schooling to be a type of venture. It can accordingly fall under this class since by and large, business prompts income.

Investment Strategies and Human Behavior

Overreaction is probably the most popularly known effect of human behavior on market prices. All things being equal, in a rational market the fundamentals of a company should determine its market price, and there should be a clear relationship between the two. However, research - as well as a casual glance at CNN's stock-ticker on any given day - shows that this relationship doesn't necessarily happen as expected.

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Investors regularly overreact, often wildly, so pushing prices up too high or pushing them down too low against their fundamentals. Not only is the market, therefore, not wholly rational in reality, but the effect cannot be attributed to any financial or company-based factor. The most likely reason for the anomaly appears to be the way investors perceive, and react to, earnings surprises or news items, or indeed other investors' actions. This overreaction occurs across the stockmarket and gives rise to several investment strategies.

Contrarian Strategies

The overreaction effect is highly pronounced when comparing 'out of favor' (contrarianstocks) against current 'favorites', or what are also known as value and glamour stocks. 'Out of favor' stocks are not stocks that are bad quality stocks, simply ones that are not attractive to the market, for whatever reason that might be. The interesting thing is, however, that over time the 'out of favor' stocks will, in general, outperform the 'favorites'. Then, when the 'out of favor' stocks become the 'favorites' due to increased
buying the effect is reversed and the process is repeated in a cyclical manner, while only minor changes may take place to the stock's fundamentals. 'This occurs,' says David Dremen, who researched the effect with a portfolio of stocks over a ten year period, 'because these stocks will tend to reverse over time as investor expectations change'.Premiums paid for high growth stocks become too expensive while 'out-of-favor' stocks begin to represent greater potential gains. The effect is reminiscent of regression to the
mean, a statistical effect where measurements will tend towards their average, and is in fact nothing new. Scientists have known for several hundred years that this kind of effect often occurs when human behavior is involved. What is new is that the effect has been found to occur within a particular domain of stocks.

Whether a stock is an 'out of favor' or 'favored' stock is indicated by their ratios.According to James O'Shaughnessy, whose extensive and well-researched findings were published in What Works on Wall Street, these include: price to book value (P/BV),price to cash flow (P/CF), and price to earnings (P/E). Stocks with the lowest ratios have the most potential to rise, particularly on good news surprises, and are therefore the ones, from this contrarian perspective, that should be sought after, providing they are
essentially good stocks.

Momentum Strategies

Contrarian investing would seem to indicate that making money in the stockmarket, over and above the smaller but consistent returns from well-known companies like Microsoft or IBM, requires buying only 'out of favor' or value stocks. However, this is not the case. Indeed, if one were to take this to its logical conclusion no one would buy rising stocks - that were on their way to becoming glamour stocks - and profitable opportunities would be missed. In addition, value stocks take an average of five years to show a worthwhile return. Clearly that is often unacceptable and research bears out, in fact, that momentum pushes many stocks towards new heights regularly, and money can be made on these stocks
considerably faster than five years. This doesn't mean that you simply buy any stocks that are rising away from their rational price due to market or behavioral influences. Such an approach would be unsystematic and likely to result in a loss. Although, as Robert Vishny points out, 'You don't necessarily make money on the best stocks in the market but on the stocks everyone thinks are going to be the best'. The rider here, of course, is that you still need to buy stocks that are good or potentially good, even though they may not be the best. Inasmuch as this is true, and you can locate these stocks, there are two
momentum strategies that can be implemented.

Why Mid Cap Funds Are For You

 The market cap of a fund helps an investor know the size of the company he could potentially invest in. These cap sizes tend to vary over time. They also vary depending on brokerage houses. Generally, a small cap fund falls into the range of less than one billion dollars, a mid cap fund falls between one billion and eight billion dollars and the large cap funds are all above eight billion dollars. Large fund tend to have ownership level restrictions, and are best for long-term investors who aren't looking for much risk. Small cap funds though, invest in companies that may not be all that stable - as they are still likely in the early stages of their business and could possible collapse. This is why small one are highly volatile to invest in, though they can give large returns. You need to be on your toes and know what you're doing to get the best here.

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A mid cap fund falls somewhere in-between these two funds. The companies in this range are slightly more stable than small cap funds. It doesn't always end up moving with the market and its ups and downs - so there happens to be more stability here. This means that you need to fear a little less about their volatility.

It gives you more returns than other as well - and it's not quite so long-term. So you get better returns than the large caps and better stability than with the small caps when you pick a mid cap fund. Over a period of time a small and mid one is likely to outperform a large cap fund. This is because a small and mid cap fund are more likely to focus on their growth strategy than already large conglomerates. They are more dynamic in their business as they are more compact.

But don't depend on every single fund which is doing well - there are always exceptions to the rule. Look at your own finances and understand where you can afford to use your money. If you are more interested in long run investments, perhaps it isn't for you. But if you want a higher return with less volatility you could consider investing in it. Remember to do your homework though, before you actually invest in mutual funds. You need to know where your money is going and what are the risks involved in a particular investment when you choose to invest. This fund value invested in midsized companies which would give you higher returns. Generally people invest in this fund because it offers vast growth opportunities as compared to other sectors.

Manuel Stotz : How to Hire a Professional Private Tutor?

As more and more students opt for supplementary coaching, this keeps on increasing the competition. And, the pressure of getting good grades and achieving excellent performance is also increasing day by day. So, in such circumstances home tutors are the best alternate for kids to build a strong foundation and that too at home!

However, hiring a good tutor is not an easy task. It requires a lot of knowledge and time on the parent's part so that they hire the best home tutor for their kids. Here Manuel Stotz suggested best tips to help out you.

Let's understand what traits and qualities you should look for before hiring a home tutor

1. A great tutor must possess good analytical and study skills that will help them find out where kids might be lacking.

2. Not only assisting kids in studies but also having sound knowledge of latest industry trends and skill set required to assist students with placement at college level.

3. Before a tutor is hired, one must count their years of experience and qualification in the relevant field. They must have hands-on experience of real teaching with good educational background.

Read this Document of Manuel Stotz and Know about it.

4. Now check for their location and area of their services and then count their availability at your place or location as per your requirements. It is always good to pick a tutor from nearby locations to avoid any delays in tutoring sessions.

5. Weigh their reputation and feedback from their previous students and employers.

6. Last but not the least, consider their fee structure, whether it justifies your budget or not. Always try to do some negotiation before finalizing the contract.

Varun Manmohan Kapur Gives Effective Investment ideas

Simple Yet Key Factor In Investing: Varun Kapur Yes Bank, former president & currently an independent investor

 Ever thought of co-relating 'Market Share' with equity returns? Varun Manmohan Kapur Yes Bank’s former president and currently an independent investor provides light on a simple yet powerful investment idea.

Whether it be debt or equity, in general, the level of risk is lower when investing in bigger companies. This got further exacerbated in the backdrop of the pandemic, smaller companies with their lower levels of resilience and limited sources for raising financing resulted in positive economic outcomes for larger players. Their already high market shares got a further fillip as suppliers, distributors, financiers, customers all resorted to ‘safer’ and ‘trusted’ brands. Apart from growth, this enhanced market share provided a cushion against lock-downs, lowering demand during the pandemic, says Varun Kapur.