‘Next decade returns will lag the past decade’

Returns in the next decade across asset classes and regions will lag the returns we've experienced in the past decade, believes Morningstar Global CEO Kunal Kapoor. He tells Ananya Grover that investors should stick to simple, long-term, and diversified portfolios.

- @ KUNAL KAPOOR, GLOBAL CEO, MORNINGSTAR

Excerpts:

Are you expecting the India-US deal to finalise and if it is already priced in the market?

I have no idea but for most investors, ten years from now, they won't even remember that this was something that happened in 2025. This can lead to variations in the market and impact portfolios in the short run but most people should not care about them. Investing is about the long game and the best thing I can tell most people is go on a vacation versus worrying about tariffs. We won't really know what the impacts are for some period but there's no doubt that it does raise costs.

What is your take on valuations in India market after the underperformance in past one year?

This year’s performance in India, is a comment on what valuations were and the reality that anytime valuations get pushed to certain levels, to earn a return back becomes much harder. I don't think it matters, you want to be in the market for the long haul and there's always periods where there's some over on the valuations that may dominate. But I think you want to stay invested. So, it's very hard to guess when those times are to get out or get in.

Will most investors that entered in past three years panic due to moderation in returns?