Thursday December 22, 2005

2006 market forecast As the mist of 2005 is beginning to settle, let me recall about the great things of year 2005. It has been a great year for the Indian stock market history. We created new highs. Despite being volatile, we moved up and the upwards journey is still continuing. Lot of people are sitting on huge profits from stock markets. However I fell that we need to be little cautious and try to average our sell and buy orders. If you have made good profits you must try to book partial profits. At the same time, we must continue to buy stock specific stores. Indian economy will grow and the GDP numbers are going to raise in the coming years. The GDP number will be far better than the developed economy and hence India will emerge as a global leader in engineering, IT services, BPO and manufacturing.

The other good thing of year 2005 has been the treks which I did with Uncle and Dipanker. As far as work is concerned, it's going to be little different. I'll be working on filesystems in a new role. 2006 will be a beginning of a new thing for me as far as career is concerned. As usual rest of things wouldn't change. Life is all about struggling and it doesn't give a chance to relax either. (2005-12-22 18:05:00.0) Permalink

Wednesday October 19, 2005

fall in equity markets... A sharp fall in equity market of emerging India is an opportunity for us to buy shares of companies having good growth stories ahead. You must try to average out the buy orders of a scrip in which you think the fundamentals are strong and growth can be maintained in the future. There're concerns like high inflation due to crude oil prices or interest rates could go up or input cost could go up, but in the equity markets one can make good money by having long term view on the economy. Since Indian companies are emerging as a leader in different segments/sectors, we think equity markets are a good asset class to invest and hence any sharp fall should be utilized to increase the exposure in the markets. You need to complete your home work before you jump in the markets. Happy Investing...!! (2005-10-19 22:19:12.0) Permalink Comments [4]

Friday August 12, 2005

Investment fundas... In the last blogs, I was described about how to find value stocks. I managed to gather some more information on this when watching classroom program on CNBC TV18 channel. Thanks to CNBC TV18 team for doing good job.

Importance of safety :-
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* Buy cheap
* Keep eye on the scrip.
* exit when valuations are stretched.
* Buy and forget strategy doesn't work in stock markets.
Parameters of buying :-
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* Return on net worth
* Cash availiability
* Return on capital
* Good dividend yield
* Low PE multiple

Parameters other than PE
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* Capital efficiency of the business
* Ability to grow
* Margin in the business from time to time
* Effective cost management
* Of course good management

How to go about sell decisions
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* Just as you buy
* Margin of safety is less. For instance when the stock is overvalued. Remember good stocks will trade at high PE multiple and it's likely that they will be expensive all the time.

Remember, tremendous amount of discipline is required in stock markets. If markets are at all time high, its likely that they will create new highs. It's totally upto to you to digest the profits and your greed level when you like to encash the money out of market. Another point is that you must buy/sell in small chunks. Try to average out buy/sell orders. (2005-08-12 22:22:42.0) Permalink Comments [1]

Wednesday July 13, 2005

And the gambling continues

2) 8th Aug 2005

This is my second blog on this subject. The other day I got the opportunity to hear about the elements of investing on CNBC TV18 channel (classroom program).

-> Knowledge and understanding of business
-> stock that are considered undervalued have larger scope
-> Look at the benchmarks (charts, reviews)
-> Convition to succeed
-> Time management is critical
-> Margin of safety.

Finding value stock is very tough. Most people go by P/E ratio and we still see loads of stocks which are overvalued but moving up  continuously. So you pay for the quality of the stock. We should perhaps look at the stories which have growth and the managment of the company also needs to be good in order to deliver the guidance. So growth and management of the company are two critical things which you must consider while investing. Afterall investing increases the wealth of a person.


1) 13th July 2005

Since this's my first blog on Indian stock market, I thought I should write
about some useful tips if you are an investor. In past one year, I figured out
couple of things which are worth mentioning here :-


(a) Be less greedy. You should be greedy because you want to make money :-)
(b) Keep strict stop losses on a counter

(c) Look at the fundamental view and adhere to technical analysis (like moving
    avg, volumes, stop losses, support levels and all)
(d) Participate in momentum driven stocks. For instance VSNL was up Rs 80
    in two consequetive trading sessions.
(e) Look at the long term view on the stock.
(f) Keep your portfolio diversified
(g) Invest in good sectors which have good growth potentional and should
    less depend upon commodity prices like steel pricess or fright rates.
(h) It's difficult to time top or bottom. So catch the train when it's slow
    and get out when the steam is cooling a bit.
(i) Punter play is not so easy in the market, so riding the wave is more appropriate
(j) Buying good stocks when they are low (due to margin pressure or whatever) could
    give good returns if the fundamental story is intact
(k) You should book profits from time to time. I think you should always have short
    term, medium term and long term view on the stock.


Happy investing!!...