Investments are a key part of a person’s financial portfolio

It is essential for a job seeker to effectively identify and leverage his / her skill sets and refrain from getting carried away by fads.

Investments are a key part of a person’s financial portfolio and its share is set to increase in the years to come with the increasing level of financial illusion and engagement. The global economic meltdown did have some impact on the Indian economy as well as the Indian financial sector however, the effect was relatively muted. The Indian asset management industry being an integral part of the Indian financial and investment space also witnessed some consolidation in 2008. However, the industry, since then has witnessed an impressive bounce back / growth and the average Asst Under management of the Mutual Fund industry has grown by around 60 percent since December 2008 and is pegged at Rs 670936 Cr as on June 2009.

With the evolving business and economic environment, opportunities have got adjusted for skill sets. It is, therefore, essential for a job seeker to effectively identify and leverage his / her skill sets and core competencies and retain for getting carried away by fads. Further, consistency and stability in taking prudent long term professional decisions will help enhance career opportunities. The Indian industry still needs large skilled manpower and job seekers focus on looking at the right organization which provides stability over this long term.

We believe that every one had ramped up their teams fairly well in the last two years, so prospects might be muted for the immediate short term but still continue to be strong for the right person. Over the longer term, the Indian mutual fund industry is still at its nascent stage, viz global economies. The penetration of the Indian mutual fund industry as a percentage of GDP is around 8 percent, around 35 percent for the UK and 80 percent for the USA, thereby presenting significant scope for expansion. With the increasing footprint of the Indian mutual fund industry the opportunities in this sector will also witness significant long term growth momentum.

An English fund manager was offering stock tips on a television channel. The best investment strategy for 2009, he advised was to buy a crate of scotch and retire to a cave in Wales for the rest of the year. The same fund manager on the same channel a few weeks ago and he seemed his usual witty self, had obviously not retired to a cave and was talking of the green shoots of recovery.

This is not meant to be yet another mildly annoying story about the fickleness of investment advisers. To be fair to our television friend, the wild swing in his views reflects, to a degree, the rapid pace change and volatility that have buffeted the global economy over the past few months. There is certainly much more optimism than in January, reflected in an up tick in stock indices around the world. From their February lows, the Dow Jones is up 15% the London FTSE by about 10% and our Sensex is up be a healthy 30%.

Financial markets have their own idiosyncrasies but they cannot de-link completely from the economic realities on ground. Thus the up tick reflects the perception that economies are recovering and the worst of the crisis is behind us.

A quick review of the changes in the global economy over the past three months might be useful. The US central bank (the Fed) and the Bank of Japan have dropped their policy rates to zero with the British and European central banks close on their heels. India’s Reserve Bank has cut the reverse repo rate (the short term policy rate) to an unprecedented 3.25% with more cuts likely.