“How deep the downtrend will depend on institutional behaviour and the retail investor response. The latter is a powerful market determining factor now. Without a doubt, the valuations are excessive and there is room for markets to correct significantly. 'Buy on dips' may not prove to be a good strategy now. Profit booking and increasing the cash component in the portfolio are advisable,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
