Markets, Myths, And The 'Three Forces' For 2026 That Radhika Gupta Wants Investors To Know
Radhika Gupta believes the most unsettling theme of 2026 is "unknown unknowns" — events no model or forecast captures, but which increasingly drive short-term market moves.
As 2026 opens with geopolitical shocks and relentless headline risk, investors are struggling to read the mood of markets that refuse to either crash or rally decisively. In a recent 'Moneywise' episode on NDTV Profit, Radhika Gupta, Managing Director and CEO of Edelweiss Mutual Fund, said that confusion is precisely the point. "This is not a normal market cycle," Gupta says. "And it’s not a calm world either."
Gupta expected 2026 to come with drama — but not quite this early. The year opened with geopolitical shock, involving extraordinary actions by the US administration. This underlined how global politics has become a first-order market variable rather than background noise.
"In 2025, it was tariffs, signalling on social media and policy theatrics," she says, adding that this feels like an elevated version of that. For investors, she says, the takeaway is not to predict the next shock but to accept that uncertainty is now structural, not episodic.
Three Forces Shaping 2026
Gupta breaks the year into three broad parts. The first is domestic India, which she sees as the most predictable element. "The worst of the domestic slowdown played out in 2025," she says, pointing to completed tax measures, easing financial conditions and early signs of earnings recovery.
The second is unfinished global business — particularly trade tensions carried over from 2025, where outcomes remain unresolved but visible.
The third, and most unsettling, is what she calls the "unknown unknowns" — events no model or forecast captures, but which increasingly drive short-term market moves.
Why 2025 Wasn’t As Bad As It Felt
Despite widespread frustration, Gupta believes 2025 deserves a more generous assessment. With geopolitical tensions, earnings downgrades, major IPO supply and sustained foreign investor selling, benchmark indices ended only 5-10% lower.
"In a different era, this kind of year could have meant a 30% fall," she says. "Instead, markets showed resilience."
The reason lies in domestic capital. India’s monthly SIP flows have risen from about Rs 4,000 crore in 2017 to nearly Rs 30,000 crore at present, creating a steady buyer base that cushions sharp drawdowns.
"This doesn’t mean markets won’t correct," Gupta cautions. "But corrections are increasingly about time, not price."
Myths Investors Need To Let Go Of
One of Gupta’s strongest warnings is against the obsession with short-term returns. "One-year returns have become dangerously overused," she says, arguing that frequent switching and performance-chasing erodes long-term outcomes.
She also pushes back against inflated return expectations. “Equities delivering 11-12% over time is not conservative — it’s realistic,” she says, noting that post-Covid returns were an exception driven by zero interest rates, not a new norm.
For 2026, Gupta’s message is simple but unfashionable: focus on preparation over prediction. Asset allocation, diversification and realistic expectations matter more than chasing the next outperformer—whether it’s a sector, a commodity or an overseas theme.
"Humility is underrated in investing," she says. "Our ability to predict is limited. Our ability to prepare is not."
