Morgan Stanley’s Ridham Desai predicts that BSE sensex would cross over one lakhs in the next 10 years which seems quite an exaggeration when it is around 30k now. Stock markets the world over including India are going through an turmoil both on macro and micro events apart from serious nuclear threat which we are witnessing of late. Inflation and job losses globally too does not paint a happy picture either. Without doubting on Ridham’s intelligence as they have a battery of analyst’s and data to support their claim, stock market analyst’s the world over including India should first predict correctly what markets would be around the next couple of years before predicting what the sensex would be after 10 years.
Investors too should not be fooled by such rosy vague numbers and not dream to build castles in the air. Today interest rates are hovering around 6-7 percent for saving instruments and an over 20 per cent return on stocks annually should not be expected by people and that too when the element of risk in stocks are pretty high. Regulators too should not allow investment firms to make vague predictions that mislead investors who lose money on false tall claims.
(The views expressed by the author in the article are his/her own.)