Welcome to Upper Crest, Outlook Business’ annual Private Wealth Roundtable 2013. It’s a great pleasure to have all of you again here. To start off, the one thing that really marked 2013 was that there were no new highs, no new lows. Except for the rupee, which misbehaved, it has been a sort of a year where the Sensex moved in a range of roughly 2,500 points, although within that range you saw sentiment swinging from moments of total despair to modest optimism.
Last year, most of our panelists felt that fixed income would be the safest bet for the year, but even that proved to be only half true because the spike in yields ended up denting fixed-income funds. Real estate, again, has been a mixed bag, with correction in pockets. Gold, of course, has been the dark horse, but even that gain was largely driven by the depreciation in the rupee as international prices weakened.
Net-net, as things stand now, there seems very little reason to be optimistic, but then, we all know that in the world of investing, last year’s performance is no indicator of next year’s. Therefore, throughout this panel discussion, we wish to reflect on the performance and lessons learnt this year and how you see the next year panning out. First, reflections on 2013: how did you cope with it?
Satya Bansal (SB): As you just summarised, we have seen a good amount of volatility, at least in terms of the mood in the market, if not in real numbers. If you take each of the asset class, I think equities have been largely out of favour. Most high net worth families got quite carried away by the exciting return they were getting in equities earlier and there was over reliance. So, when things turned out differently, they have shied away. And now, debt is being overplayed in the market and we are seeing significant flows towards that.
Going forward, our view is that we would carry some amount of re-investment risk in 2014. Typically, in our experience, as and when yield starts softening, we usually see a significant amount of run-up in the equities market, but catching this run is always tricky. In any case, we should see some allocation back i