2023
Falconstar Q1-2023 Private Wealth Advisory Report
Dear Investors,
As FY 2022-23 drew to a close for Indian investors and the government threw a googley at the end with removal of Indexation benefits on Debt Mf from 31.mar.23, the opportunity spectrum for India Investing continues to be marginalized with more -ve than +ve incentives. Govt has also levied dividend tax and LTCG in past 5 years.
The popular perception is that India in 2023-24 will follow the tune of elections and govt will protect the market from falling before may24 verdict. However, there could be opposing forces at play with global bankruptcies and recession. India will not remain unaffected although strong political mandate will give India an Oasis status.
Falconstar continues to invest on side of caution with Balanced Advantage (BAF) and Debt Funds with double 2X SIP if Markets correct on month-by-month basis depending on Client profile.
Delighted to share the Falconstar Quarterly Wealth Report Q1 2023.
View complete pdf :Falconstar Q1-2023 Private Wealth Advisory Report
Falconstar Q1-2023 Global & India Equity Report
Dear Investors,
Greetings for Q2 2023. With Fed funds rate at 5.25% in May23 the rates are at highest levels since 2007. It is clear that most of the rate hikes are behind us, it is unlikely that Fed will start reducing rates in 2023 anytime soon. It will take 12-18 months ideally for the rate hikes to sink into the Financial markets before any geo-political event triggers a recession or market collapse.
With Fed Funds rates at 5% there has been some tightening of loose liquidity in VC (Venture capital) / PE (private equity) markets as time to fund loss-making start-ups grinds to a slow halt.
Currently leveraged Loan default rates are at 3-4% in US in 2023 which is above the 2.5% 15 year avg but below 6% threshold experienced during most recessions. US has the most sophisticated Credit data worldwide and hence we follow the US market parameters. With Nasdaq100 up 33% YTD and S&P500 up 11% YTD the markets are certainly digesting and ignoring the rate hikes. Valuations are above average with Nasdaq P/E 24 , SP500 P/E 22 & investing means chasing the market up.
Indian NIFTY50 Markets has 2.55% ytd returns and in the absence of any geo-political event, it is racing towards the next target of 20K. However, there are select Mid-caps and Small-caps offering better growth opportunities from a 3-5 year horizon. Overall markets valuations of P/B > 4 does not provide comfort from a 20 year historical perspective.
Timing of next recession is unclear but it seems by year-end 2023 with India elections on the horizon there will be forces at play in the market to make incumbent BJP and Modi unpopular by creating an economic panic. GEAR and GARP portfolios continue to remain invested in Markets while making fresh purchases only on 10% corrections.
Delighted to share the Falconstar Quarterly Portfolio Research Report Q1 2023.
View complete pdf :Falconstar Q1-2023 Global & India Equity Report
Falconstar Q2-2023 Private Wealth Advisory Report
Dear Investors,
Markets in 2023 are Merry Go Round ⭐ with Indian NIFTY touching all-time high of 19K in June-23 & yielding 20% returns in 1 year. Same story resounds in global markets with Nasdaq giving 35% returns YTD in 2023. With Fed funds rates @ 5% and Indian 10-year Bond at 7% there is room for max 1 more rate hike as per general consensus.
Given valuations P/E / P/B are above 1-sigma of 20-year averages, it makes cautious sense to stay invested in Equities but invest new Funds in India IG Corporate Bond Funds @8% or Balanced Advantage BAF. Longer term 5-7-year horizon investors can continue SIPs into Small-Midcap space.
With irrational exuberance likely to continue and US , UK, India IN elections in 2024, enjoy the party
Market Correction = Irrational exuberance + Participation Froth + Bad News
Delighted to share the Falconstar Quarterly Wealth Report Q2 2023.
View complete pdf :Falconstar Q2-2023 Private Wealth Advisory Report
Falconstar Q2-2023 Global & India Equity Report
Dear Investors,
Q2 2023 continued the year's upward ascent for Equities as Fed raised rates to 5.25% and markets ignored the rate hikes. While Nasdaq has returned a stellar 27% YTD and NIFTY MidCap has risen 22% YTD 2023, the 2024 election year in US, UK and India will see continued bullishness supported by Ruling parties.
The gravity of higher interest rates will eventually bring the markets bubble burst only after a period of 12 months of irrational exuberance. Falconstar Investments continued to be invested in Equities but with a comfortable 20% cash allocation. Falconstar Investments is also deploying funds in Dividend plans for Senior citizens and Balanced (BAF) funds to realize gains while taking advantage of 8% Yields in Indian Fixed Income markets.
UAE Equity continues to be an undiscovered asset class & worth exploring for Investors who are already invested in UAE Real estate.
Delighted to share the Falconstar Quarterly Portfolio Research Report Q2 2023.
View complete pdf :Falconstar Q2-2023 Global & India Equity Report
Falconstar Q3-2023 Private Wealth Advisory Report
Dear Investors,
"Higher for Longer" has been a resounding theme in Interest Rates regimes as US Fed raised rates by another 50 bps in Q3 2023. With Inflation not near their target of 2% there is expectation that rates will remain at current levels for near future 2023.
Meanwhile, as Gold & Crude both commodities have gained in past 5 years, we have seen Gold coming off in 2023 c. (-5%) and Crude has risen (+5%) lately due to Israel / Gaza conflict. The Indian NIFTY 500 Markets have given handsome +17% returns in 1 year, we can expect markets to be more exuberant in 2024 if Indian Govt succeeds in ensuring the growth / hype into Elections 2024. For Senior Citizens Dividend Plans are ideal in this environment along with an allocation to Balanced Advantage (BAF) funds.
UAE Equity continues to be a good Dividend (Distribution) story with 0% tax unlike India while US Equity (Nasdaq) is a good 10 year SIP for Indian Investors looking for Global exposure and Long term $ growth.
Delighted to share the Falconstar Quarterly Wealth Report Q3 2023.
View complete pdf :Falconstar Q3-2023 Private Wealth Advisory Report
Falconstar Q3-2023 Global & India Equity Report
Dear Investors,
7th Oct in Israel marked a repeat of 9/11 & 26/11 memory as events unfolded and casualty figures added up to 1400 on that fateful day. UAE equity markets corrected 10% in the immediate aftermath due to fears of the conflict spreading across the global & middle-east.
As US Fed stopped the rate hikes at 5.25-5.5% the Markets continue to ignore higher rates with low unemployment and no sight of recessionary economy. This combination of high systemic liquidity, booming growth & intermittent geo-political tensions has led India NIFTY SmallCap returns of 37% YTD & Nasdaq100 up 30%+ YTD as well.
Falconstar GEAR and GARP portfolios continue to enjoy the Equity upside with 14.93% and 9.53% YTD returns while being large-cap dominated portfolios with 10% cash buffer. As 2024 approaches, the cautiously optimistic stance will be maintained with 10% risk-off mode in case of US credit downgrades and meltdown.
SIP for next 5 years and 2x tactical SIP in case of downturn below 200 DMA with 3 month -ve returns is the Investment strategy for US, India & UAE Equity.
Delighted to share the Falconstar Quarterly Portfolio Research Report Q3 2023.
View complete pdf :Falconstar Q3-2023 Global & India Equity Report
Falconstar Q4-2023 Private Wealth Advisory Report
Dear Investors,
With the bells of 2023 ringing to an end the Indian investors clocked 20% returns on Nifty50. The US investors had a phenomenal 23% returns on S&P500 compared to a historical average of 7-8%.
Past 2 years, the Markets have largely discounted the geo-political events in Ukraine and Israel to continue their forward march at 5.3% US Fed rates. While the Fed Balance sheet is shrinking at $1 Trillion per year, it will take another 2 years to reach pre-covid levels.
The Markets are not following a Mathematical model in 2024 as several dozen Democracies come up for Election. The art of Investing suggests Investors to continue practicing Debt: allocation while earning Equity upside. If Inflation persists in 2024 and rates rise 25-50 bps again, it will be an ideal time to continue ploughing funds in higher interest rates.
In Indian equities, the “Mid-to-Mega" theme continues to be dominant as we can expect 25-30 firms from Mid-cap space to grow into Large caps over next 5 years generating 3-5X of Market returns %.
Senior citizens stay Invested and enjoy the Dividend % payouts + SWP (Systematic withdrawals) as India enjoys the Golden Decade started from 2020 onwards.
Delighted to share the Falconstar Quarterly Wealth Report Q4 2023.
View complete pdf :Falconstar Q4-2023 Private Wealth Advisory Report
Falconstar Q4-2023 Global & India Equity Report
Dear Investors,
With the bells of 2023 ringing to an end the Indian investors clocked 20% returns on Nifty50. The US investors had a phenomenal 23% returns on S&P500 compared to a historical average of 7-8%.
Past 2 years, the Markets have largely discounted the geo-political events in Ukraine and Israel to continue their forward march at 5.3% US Fed rates. While the Fed Balance sheet is shrinking at $1 Trillion per year, it will take another 2 years to reach pre-covid levels.
The Markets are not following a Mathematical model in 2024 as several dozen Democracies come up for Election. The art of Investing suggests Investors to continue practicing Debt: allocation while earning Equity upside. If Inflation persists in 2024 and rates rise 25-50 bps again, it will be an ideal time to continue ploughing funds in higher interest rates.
In Indian equities, the “Mid-to-Mega" theme continues to be dominant as we can expect 25-30 firms from Mid-cap space to grow into Large caps over next 5 years generating 3-5X of Market returns %.
Senior citizens stay Invested and enjoy the Dividend % payouts + SWP (Systematic withdrawals) as India enjoys the Golden Decade started from 2020 onwards.
Delighted to share the Falconstar Quarterly Portfolio Research Report Q4 2023.
View complete pdf :Falconstar Q4-2023 Global & India Equity Report