InvestorQ : Do you think it is a good strategy by mutual funds to prefer global stories over domestic story stocks?
Arya Nanda made post

Do you think it is a good strategy by mutual funds to prefer global stories over domestic story stocks?

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Anjana Aiyar answered.
4 weeks ago
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Let me put it this way, it is not about good and bad, but about picking the low hanging fruit. Today, global stories like chemicals and metals are the low hanging fruit at a time when India’s growth is likely to diverge from global growth. For example, global recovery could boost demand for metals and Chinese environment restrictions provide a field day for Indian companies. MFs are focusing on stocks that entering this supply chain.

However, there is a word of caution in following such a strategy. The entire story that fund managers are playing is a very opportunistic China story and that can turn any time. Demand dependence is still on China as US and Europe have limitations. Under these conditions, the one condition that stood the test of time is the domestic consumption story. They may be in trouble right now, but domestic stories are always long term winners.

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