“From Dalal Street to Wall Street” examines the transformation of Indian financial markets and their expanding global integration. Over recent decades, India has modernized its financial system through key reforms, such as the establishment of the National Stock Exchange and the adoption of electronic trading. This evolution has attracted significant foreign investment and enhanced market efficiency, positioning Indian markets as increasingly interconnected with global financial systems.
The report highlights both the opportunities and challenges arising from this integration. While global capital inflows and market connectivity offer growth prospects, they also expose Indian markets to international economic fluctuations and geopolitical risks. To address these challenges, Indian regulators have implemented reforms to maintain market stability and align with global best practices. The future outlook remains positive, with continued growth anticipated despite the need to navigate potential risks.
By- Yogesh Kansal, Cofounder & CMO, Appreciate
Now is a great time to invest in the US markets. The inflation trajectory is on a downhill, and everybody is counting on the possibility of a rate cut in September. Meanwhile, the market correction of August 5 gave a much-needed breather to the markets, and since then, the US indices have been vaulting upwards.
Our new report ‘From Dalal Street to Wall Street’ aims to help Indian investors looking to diversify, and find strong pools of value in the US markets. The technology, semiconductors, financials and pharmaceutical segments have been delivering stellar returns, and if the September rate cuts come through — as is largely anticipated — then the US party will likely be longer and louder.
A glance at the gains delivered by US ETFs last year shows that they have outperformed many of the Indian mutual funds. Take, for instance, the Nasdaq 100 Technology Sector index which gave close to 70% returns last year. The VanEck Semiconductors ETF managed to top that by delivering around 75% returns. Investors who are accommodating of more risk can opt for alternative asset ETFs like the First Trust SkyBridge Digital Economy ETF, which delivered stunning 193% gains last year, albeit with higher volatility.
In any case, the performance of players like Nvidia (169% returns in 1 year), Super Micro Computer (138%) KKR & Co (100%) or Spotify (157%) or Meta (84.38%) speaks for itself. Several US stocks have delivered such outsized returns, and Indian investors can amp up their gains, by spreading their investments to the US shores. Further, domestic investors also benefit from the consistent trend of USD appreciation, which adds 3-5% to the total annual returns in addition to portfolio gains.
Besides profiting from large cap stocks, new market movements indicate that a fund rotation is afoot, and profits booked by institutional players are finding their way to the small-cap segment. The small-cap space is still under-valued, and discerning Indian retail investors can build wealth by zeroing in on quality small-cap stocks.