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Posted by: Arti Anand Bhargava on Fri, Jan 2nd, 2015

Nifty's Journey over the Last 10 Years

 

Nifty Candlestick Chart (Last 10 Calendar Years)

 

2014 ended on a positive note for the stock markets, as the Nifty gained 30% in this calendar year. Even as bullish fervor seems to have gripped the market, let’s see how this looks like when viewed from a 10-year perspective. Some simple take-aways:

 

a. 2014 is not the best year yet. That trophy goes to 2009 when the Nifty gained 76% coming from the bottom of the global financial crisis.

b. 8 out of the last 10 calendar years have been positive.  This is the third positive year in a row and looks spectacular when compared with 6% of last year.

c. The Nifty crossed 6000 - a level that seemed like a tough resistance in the last 7 years. To those that invested at the top of the market in 2007, the relief came only in 2014.

d. The investor who came in 2004 Jan and stayed through the ups and downs would still have made a 15.7% return. But those who came at the top in 2007, still languish at 4% return.

e. The range between the high and the low in 2014 was high. Only 2008 was worse. From the lows in the early months of 2014, this rally was mostly unexpected.

f. The year closed near the high, a sign of bullishness compared to the bearishness of 2008 and 2011, when the year ended close to the low.

 

There is nothing in the past data to tell us how 2015 will look like. But 2014 is not one of the most spectacular, yet. It only signifies a break away from the hope and despair of 2010-2013. Does anyone even recall that 2012 gave a 27% return? It was just lost in the lacklustre 6% of 2013. Therefore, there is no point reading too much into this number, despite the relief and renewed hope.

dhan singh on Sat, Jan 10th, 2015 6:31:01 pm

I entered in year 2007 u r right .in HDFC top 200 by SIP and still continue while I redeemed some amount @ 16.4% growth in year 2013 last .

Nita on Mon, Jan 5th, 2015 3:22:35 pm

The analysis done is really good and simple to understand....as they a simple graph/picture can explain what long paras or lectures can't capture. Logically we definitely have great and positive years ahead.

Rajgopal on Sat, Jan 3rd, 2015 9:27:31 pm

I agree with this stand alone analysis. The forces at play both in 2007-08 and 2014 are unique. Several world economies are in now recession mode. Rupee has depreciated during this time. A holistic analysis taking into account currency depreciation as well as state of major world economies would provide a better insight into our economy.

Atul Kamdar on Sat, Jan 3rd, 2015 7:50:09 pm

Quite good analysis. Yes, this symbolises that the best is yet to come. ACCHE DIN AANE WALE HAI.

SRIMANT MISHRA on Sat, Jan 3rd, 2015 12:57:33 pm

Logically analysed. I agreed,the best is yet to come.

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