US presidential election and its effect on Indian Markets

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I was just following up on the US presedential election and wanted to get a feel of how the Indian Markets will react to it.

Following is my thinking, It may be flawed but wanted to know other Experienced ValuePickrs views on the same.

  1. Markets hate uncertainity, Specially large Mutual Funds. and Donald Trump is the least favourite in the Indian markets as he is against outsourcing.

  2. The election results shall be in January 6th as per wikipedia. So I think till this date exposure to Export oriented companies like Pharma and IT shall see less exposure by Mutual Fund Houses to look good on the books and its prices will fall.

  3. All this money taken out from Pharma and IT co’s shall be redeployed in Gold, Indian economy based companies. and its prices will rise a bit.

  4. Post the results, If Hillary is elected. There might be a election win rally and immediate reversion to mean in export staocks.

  5. In case of Trump coming to power, a bear phase and then once again reversion to mean shall take place over the next year.

  6. As a Value investor, I think the stratergy should be to have exposure to Indian economy based companies for a short term profit and accumulate the export oriented companies as and when corrections take place.

  7. Also a small portion to be held in cash/gold to be deployed post the election results to take care of uncertainties.

I know that such macro events do not affect the long term story of stocks, however we as individual Investors have that edge of flexibility to redeploy capital based on the Market situation and should take advantage of this to maximise the profits.

Please provide your inputs in this matter.

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With all due respect, this is a futile discussion to have. No one knows what will happen or even can reasonably guess. Too many unknowns at this time. Who will win, what will he/she do after he/she wins. None of this will yield any actionable insights that will improve your investing outcome.

Best to keep away from this noise.

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Sir,

I agree with you that there are too many unknowns at this point and it may not affect my investment philosophy. However my intention was to analyse and follow how is Mr market going to react to these events.

As I have mentioned market does not like uncertainty, Hence it may be worthwhile to have a feel of the market as the election progresses,

Even if it is not resulting in actionable outcomes, It may act as a timeline of irrationality Mr market has once the election is completed.

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Refer to my post below.

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Your link is not visible. It requires login to Evernote which many people may not have.

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@Alphin

Pasted image914×325 28.7 KB

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Pharma industry under Trump administration: Don’t uncork the bubbly just yet