Benzinga - by The Arora Report, Benzinga Contributor.
Signal(s) to enter, add, reduce, exit, hold or change.
India represents an opportunity for long term investors. However, India is a developing market. It is important to follow billionaire techniques as encapsulated in Trade Management Guidelines by The Arora Report to do exceptionally well as an investor, especially in emerging markets.
The Chart Please click here for a chart that compares India Small Caps ETF iShares MSCI India Small-Cap ETF (BATS: SMIN) to U.S. Small Cap ETF iShares Russell 2000 ETF (ARCA: IWM). Note the following:
- The chart shows that year to date, small caps in India have outperformed small caps in the U.S. by 18.2%.
- Small caps are often more inefficient than large caps due to lack of analyst coverage. For this reason, for prudent long term investors, small caps often provide a better opportunity than large caps.
- India represents a large opportunity in small caps.
There are indications that Apple intends to increase production in India to approximately $40B by 2028.
In The Arora Report analysis, while Apple has not yet shared plans to manufacture iPads and MacBooks in India, Apple will likely begin making AirPods in India next year.
Magnificent Seven Among the Magnificent Seven stocks, Tesla Inc (NASDAQ: TSLA) is exploring major investments in India. Alphabet Inc Class C (NASDAQ: GOOG), Microsoft Corp (NASDAQ: MSFT), Amazon.com, Inc. (NASDAQ: AMZN) and Meta Platforms Inc (NASDAQ: META) already have major investments in India. Expect them to add to their investments in India.
Manufacturing Powerhouse We previously shared with you that manufacturing is moving out of China and into India. India wants to be a manufacturing powerhouse.
Challenges At present, India must overcome two hurdles to become a manufacturing powerhouse.
- India does not have a strong supply chain for materials comparable to China’s strong supply chain.
- India does not have a trained workforce on par with China.
Technicals In the short term, technicals are overbought. This means that investors need to be patient and wait for a pullback in the buy zone.
Valuation One of the risks investors should be aware of is that India is an expensive market. This is due to great long term growth prospects. This is also another reason to buy only on a pullback in the buy zone.
Opportunity In The Arora Report analysis, India is one of the best opportunities in large economies for the long term. In the short term, India is overbought and expensive.
Small Caps Small caps are doing well. In The Arora Report analysis, they will continue to do well. In India, over the long term, small caps may perform better than large caps.
ETFs Of Choice ETFs for investing in India are:
- VanEck Digital India ETF (ARCA: DGIN)
- WisdomTree India Earnings ETF (ARCA: EPI)
- Franklin FTSE India ETF (ARCA: FLIN)
- VanEck India Growth Leaders ETF (ARCA: GLIN)
- Columbia India Consumer ETF (ARCA: INCO)
- iShares MSCI India ETF (BATS: INDA)
- Nifty India Financials ETF (ARCA: INDF)
- Direxion Daily MSCI India Bull 2X Shares (ARCA: INDL)
- iShares India 50 ETF (NASDAQ: INDY)
- India Internet & Ecommerce ETF (ARCA: INQQ)
- WisdomTree India ex-State-Owned Enterprises Fund (ARCA: IXSE)
- First Trust India Nifty 50 Equal Weight ETF (NASDAQ: NFTY)
- Invesco India ETF (ARCA: PIN)
- iShares MSCI India Small-Cap ETF (BATS: SMIN)
Prudent investors should be patient and wait for a pullback.
EPI Zones The buy zone is ***. To see the locked content, please click here to start a free trial.
The short term rating is ***.
The medium term rating is ***.
The long term rating is a ***.
SMIN Zones The buy zone is ***.
The short term rating is ***.
The medium term rating is ***.
The long term rating is a ***.
What To Do Now Those in India ETF EPI or India Small Caps ETF SMIN who have taken partial profits taking advantage of the strength may consider continuing to hold.
Those who have not taken partial profits may consider taking partial profits.
Those not in EPI or SMIN may consider following the parameters given above.
The Arora Report is known for its accurate calls. The Arora Report correctly called the 2008 financial crash, the start of a mega bull market in 2009, the COVID crash, the post-COVID bull market, and the 2022 bear market. Please click here to sign up for a free forever Generate Wealth Newsletter.
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