Swanand Kelkar from Breakout Capital Advisors has some exciting thoughts about investing in countries that are developing, known as emerging markets. While many people think these investments are too risky right now because of issues in the United States, Swanand believes there are good reasons to pay attention to these opportunities.
He points out that while the U.S. market has a high price-to-earnings ratio (22), emerging markets are cheaper at a ratio of around 20, with some even being as low as 10-11. This means you can get quality stocks for a better price! Countries like India are on the right track, focusing on better government budgets and milder inflation compared to richer countries. This creates a great environment for growth.
Despite concerns about foreign investment and a weakening rupee, Swanand explains that many investors focus mainly on the U.S. market because it represents a huge part of global investments. He compares it to cricket, saying when a player is scoring well, no one worries about their technique. But when their performance declines, everyone starts looking for flaws.
The U.S. has its issues, especially with its high debt, which could make investors shift their focus back to emerging markets. Swanand shares that the investing environment is volatile right now—with a lot of ups and downs. While it’s tough to predict when markets will hit bottom, he believes it’s essential to watch the bigger picture.
In summary, there are solid arguments for investing in emerging markets, especially in India, despite current challenges. If investor interest swings back, these markets could surprise many!
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