Such a market environment usually brings in complacency and participants shun caution to make the most of the situation. Post the market crash in March 2020, the rally might appear to be broad-based from the perspective of the benchmarks. With identical market capitalization and industry, a slight miss in choice would have panned out extremely differently for an individual. We have had instances in the markets, where a high P/E stock has posted a better price appreciation, year-on-year in comparison to low P/E stock. The reason being that when bull markets plateau, it is the high market sensitivity stocks that tend to correct the most.

Source: Mint July 18, 2021 07:30 UTC