Shift to a diversified passive fund to survive fickle US market: Analysts

Besides growth-oriented active fund, add value-oriented fund to your portfolio

The Nasdaq-100 and the S&P 500 Index of the US have corrected 13.1 per cent and 6.9 per cent, respectively, from their 52-week peaks. Indian investors, who in the past few years have begun investing in US-focused funds, need to brace for higher volatility.

Rate hike fears

Inflation is the key factor roiling the US market.

“Investors now expect central banks across the world to increase interest rates at a quicker pace than was envisaged earlier. Bond yields are hardening. When the cost of capital rises, equity valuations tend to come down,” says Rajeev Thakkar, chief investment officer, PPFAS Mutual Fund (MF). Valuations