India, Jan. 7 -- It is an accepted norm. Unless a nation's GDP grows at a frenetic pace, double-digit or nearabout the figure, the returns from its stock markets will never be decent. High growth equates higher returns from investments. This is why we get excited when India grows at seven-eight per cent a year. We assume that this will translate into higher corporate earnings due to higher volumes and profits, lower price-earning valuations of the stocks and, hence, opportunities for the stocks to rise in the future. In such cases, we expect the stock market rallies to be secular, i.e., almost each stock, whether large-cap, midcap, or small-cap, will rise in tandem with the GDP.

However, this may be a fallacy. In many cases, the stock ra...