In the short term, there may or may not be more volatility. It is not only difficult to predict, it is almost impossible to do so. For one simple reason. No one knows exactly how things will pan out between China and the new US administration. And depending on how they do, short-term headwinds and uncertainty are quite likely. But will this impact an Indian small-cap company that makes power equipment? Or one that has just executed its expansion plan? The answer is no. While their stock price may be impacted, their earnings will not. And in the long term, what matters to the street are earnings. So if one is reasonably sure of two things – that earnings are likely to grow, and the company meets some quantitative parameters – then this volatility is an opportunity from a long-term perspective.
