Monday, March 17, 2008

Sensex - 10K in one year and 80 K in eight years !

Sensex likely to go up to 40K (min 25K) by Sept 2013 and 80K (min 45K) by 2016.

However before that , Sensex likely to breach the 10K mark too in the next 18 months period.

Here's how the the Senxex's 10 year historical trend looks like.

Cycles, in stock markets and in the economy go hand in hand and repeat themselves. Check out the table below. The stock markets have corrected by more than 50% in past and have rallied by more than 50% too (in fact much much more than that).

Have also provided Sensex projections - best case and worst case. Projections based on certain assumption on length of cycles and severity and timing of economic slowdown and subsequent recovery.

Go back in time. When during end of 2004, the markets were at around 3000 levels , levels of 20000 in just 4 years hence would have sounded ridiculous.

Just as levels of 10k were sounding absolutely ridiculous 6 months back..!

Markets are harsh and unforgiving. But for those who can think (and hold stocks) for a 7 year range, they are one of the best investment options.

As we go ahead in this fascinating journey of stock markets, I will talk about my thoughts on making super normal returns in stock markets on a long term. And also revise the projections (if necessary) as we get more and more additional information

And believe me , super normal returns in stocks is more psychology than analysis.