Markets over the past six weeks have moved less on fundamentals and more on headlines. The Iran conflict triggered a sharp selloff, wiping nearly 10% off the Nifty in March. What followed was a series of whipsaws: ceasefire hopes led to a rally, talks faltered and markets slipped again, and renewed diplomatic signals sparked another rebound.
Even after an 8% recovery so far in April, the index remains below its pre-war levels of around 25,000, while oil prices continue to hover at elevated levels, keeping macro risks alive. Against this backdrop of geopolitical volatility and uneven recovery, investors are being forced to rethink strategy. The consensus among market experts is that survival in this phase depends less on prediction and more on discipline.
Stick to valuations
One of the clearest emerging strategies is valuation discipline. Paresh Bhagat, CIO of Veer Growth Fund and Chairman at Mangal Keshav Financial, says investors should prioritise companies trading at reasonable multiples with visible earnings support. In uncertain environments, expensive stocks tend to correct the most as sentiment unwinds, while fairly valued businesses offer downside protection.
The shift, therefore, is away from narrative-driven investing toward fundamentals-backed opportunities where risk-reward remains favourable even if volatility persists.
Focus on business fundamentals
Markets are currently reacting to every geopolitical update, oil price move, and global signal. But Bhagat emphasises that reacting to each headline often results in poor outcomes. Instead, investment decisions should be anchored in earnings visibility, balance-sheet strength, and intrinsic value.
In this framework, short-term volatility becomes data rather than a trigger for action. If the underlying business remains intact, price swings alone are not a reason to exit.
Deploy capital in phases
Another key shift is in how investors are deploying capital. Rather than taking concentrated bets, a staggered approach is gaining traction. Bhagat notes that phased investing reduces timing risk and improves average entry prices in volatile markets. This becomes particularly relevant in the current environment, where direction is uncertain and sentiment can reverse quickly based on geopolitical developments.
Diversify across assets
Sidharth Sogani Jain of Blue Aster Capital said asset allocation is key in this cycle. Gold, he notes, is performing its traditional role as a hedge, with prices already elevated and further upside expectations. However, he cautions against overexposure, advocating balanced allocation.
He also flags the volatility in oil, which is trading near $100 per barrel but could swing sharply depending on how geopolitical tensions evolve. This makes position sizing critical, especially for trades driven by news flow.
Beyond commodities, Jain points out that assets like Bitcoin continue to hold firm in the $70,000-74,000 range with long-term upside expectations, while equities are still expected to deliver around 10-12% annual returns despite near-term risks.
Manage risk, maintain liquidity and discipline
The final and perhaps most critical strategy is risk management. Ravi Singh of Master Capital argued that the biggest risk in such markets is behavioural. Reacting emotionally, abandoning long-term plans, or attempting to time the market could be detrimental.
He recommends maintaining a diversified portfolio aligned with individual risk tolerance, holding some allocation in cash or liquid assets, and periodically rebalancing to avoid concentration risks. Systematic investing, he adds, is generally more effective than trying to identify perfect entry points.
Vinit Bolinjkar of Ventura reinforces this view, suggesting that portfolios should be anchored to companies with strong cash flows, pricing power, and resilient balance sheets. He also stresses the importance of keeping “dry powder” ready.
Diversification across sectors and asset classes, combined with a long-term investment horizon, acts as a buffer against volatility. Short-term price moves, he said, often diverge from intrinsic value, and investors who stay patient are better positioned to benefit from eventual recovery.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
