Is it a good time to invest in the Indian share market? I have 1L. What should my portfolio be?

Is it a good time to invest in the Indian share market? I have 1L. What should my portfolio be?
No.
It is the time to take your cash and sleep over it. We don’t know how long this corona crisis will go. The longer it will go, the bigger economic depression will be. In the last two weeks however, markets were bullish. Nifty 50 climbed around 20% and so the stocks market around the world.
Reason. Bulls will tell you things like:
  1. RBI cutting repo rates.
  2. RBI announcing liquidity.
  3. RBI buying government bonds.
  4. RBI announcing stimulus package.
While these decisions would have been of great help if the crisis was purely economic in nature. But, it is a cocktail of economic and existential crisis and frankly even the stalwarts don’t know what lies ahead. This is just the first bull trap phase market is going through. The market will have a number of bull traps as there is a very high degree of uncertainity.
Second, the banks are suffering from bad loans and credits. Although the banks have always suffered from bad corporate loans but now they have a good amount of consumer credit and even if the lockdown extends by June, defaults will rise a lot. Banks today have around 28% of credit in the form of personal loans and they are giving it on very high interest rates (from 20% to 40%).
Third, IMF has already warned about a very serious recession.Just a few days before IMF announced this I was having a similar discussion with a friend on the lockdown and its effects on economy and we have reached on the same conclusion.
Fourth, the markets are still at average valuation. Nifty PE is around 20.5 currently. I calculated the fair value of Nifty using my own techniques at which I would have started buying stocks and it was around 7800. But in the wake of the pandemic I don’t want to comment anything. The low can be as low as 4800 with Nifty PE reaching less than 10.
Fifth unemployment was already very high and corona has already made it worse.This will also lead to rise in criminal activity.
Sixth and most importantly never believe in recos. A lot of people including find managers have come out saying that this is a once in a decade opportunity. I would say only one thing. Never believe them. I am not sure if they do this intentionally and trap retail investors by doing so.
So, what shall one do?
I am sharing my strategy here.
After the highs of early 2018, I sold all my midcap stocks and started moving money to large cap stocks and Gold (except a few midcap stocks). Nestle, Hindustan Unilever, Avenue Supermarts, HDFC Bank, Asian Paints, Pidilite Industries, Jubilant Foodworks, VIP Industries, Relaxo Footwears, Bajaj Finance, etc.
After this Corona crisis was highlighted I sold all my mutual fund holdings and most of the stocks and currently my portfolio is around 60% Gold and rest is mostly into FMCG stocks and Pharma funds. I am planning to realise my gold gains (because if Corona effect rises more Gold may also come down) and sit on cash. I don’t want to look into market until we have a medical breakthrough or Nifty makes the bottom of 4800.
Well, I have written enough. These are just happy scenarios I am talking about. I don’t want to write about worst because it may create panic. Just read how our financial institutions crumbled after a dual hit from The Great Depression in 1929 and then the World War 2 and new financial institutions were set up in 1945. How many people lost everything and how many died?
There is no point in investing in this market right now.
Edit 1:
US Recession model today showed 100% probability of recession in next 12 months. The last time it crossed this probability was in 2008 and 2001. Also, there are too much similarities between 2001 crash and current scenario. You can play with the link in footnotes.
I say it again. There is no point to invest in this market.
Edit 2:
In an unprecedented decision, Franklin Templeton Mutual Fund has shut six of its open-ended debt funds, effective April 23.
The six schemes are as follows:
- Franklin India Low Duration Fund (FILDF),
- Franklin India Dynamic Accrual Fund,
- Franklin India Credit Risk Fund,
- Franklin India Short Term Income Plan,
- Franklin India Ultra Short Bond Fund, and
- Franklin India Income Opportunities Fund (FIIOF).
Total combined AUM is 30853 crores with an exposure of 2100 (7%) crores in ADAG and Essel Group Companies.
Umesh Mehta’s, Head of Research, Samco Securities, reaction on it:
Franklin Templeton’s fund closure is an eye-opener for the RBI that its liquidity efforts are either insufficient or are not effective in de-freezing the liquidity crisis.
I say it for the third time, Buy Gold. Keep cash. Forget everything else.

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