Friday, November 12, 2010

Even at 20,000 the Mid caps and Small caps make lot of investment sense

The market seems to have crashed today and has sort of put a brake on the optimism that was catching up among retail investors after  a very good debut of the Coal India IPO. The IIP numbers that dampend sentiments of investors should not really deserve so much of importance from a long term investor perspective. The corporate growth story and the current valuations atleast from a perspective of small cap and mid cap stocks have still a lot of gap. Even if we account for the typical risk associated with small cap or mid cap stocks the valuation gap is enormous.