Markets
are funny. And I say markets are sadistic too. My mere stint in them for three
months has taught me a lot. It has the ability to engulf you, woo you and then
discard you like the UPA did to didi. (Haha that was seriously funny though). (In
this case I don’t care about the knee jerk reaction but admire the confident
stand by the party. Kudos. I say India has finally landed.) .
What
I understand is that markets purely work on the mechanism of supply and demand.
So the price at what you buy or sell plays a crucial role. But who gets trapped
in this mechanism? Yes you and I, who think markets, are soaring, and before
you know, it’s all gone. Well let’s face it; we have to be extra cautious backed by consistent expert advice, before we plunge into it.
When
I say this I recollect the TV advertisements which feature in stunts. They come
with a disclaimer ** Do not try this at home / without an expert .It is
dangerous **. I can perfectly correlate the market to the same. I agree when
financial advisors claim that equity is the best asset class to get superlative
returns as it beats inflation and is devoid of tax and so on. However there lie
the clauses attached.
Let
me just elaborate with hind-sight. The market crashed in 2008, followed by a
massive bull run in 2009. The horizontal stint continued in 2010. 2011, it fell
considerably. Until now 2012 seemed dull, if not for the sudden Bull Run. The factors
pertinently being the ECB Liquidity move, QE3 and now the UPA reforms. However,
when we look back, how many of us would have known the exact points of
deflection. Markets are evidently too quick to factor in any news. So the
moment you blink, market has reacted and run way ahead. Ok now you wake up, and
say I wish to join this marathon run too. You start to accumulate and by the
time you realize, you shall be accompanied by bears.
Another
prominent dilemma I see that many us would have faced. Buy, when the IPO is
launched on a high, and then wait till we reach our graves for the prices to
reach those levels again.(Somehow reminds me of Facebook). My observation tells
me, that it’s psychological to plunge into the market when it’s at the peak. Everyone
is hesitant in the bear zone. But common sense states buy low, sell high. Well
I’m guessing we shall all learn that after we get into the ring and get
crushed. (Including me at this stage).
Let
me further elaborate more on my personal observations;-
- -When you do invest (especially with bottom- Up)
Approach look into the fundamentals backed by the technical’s of the stock .If
you don’t understand, ask your expert to give you a review of both .It
certainly works best.
- -Understand
sectors. Not all work in your bullish run. The Pharma and FMCG sectors seem to
be in a committed relationship with the bears. They are defensive in nature. So
they will not make you, your moolah in buoyant markets. Or keep it for a long
time frame. Most likely to work. The Infrastructure sector is good ally of the
bulls.
- -Mid-cap and small caps mostly outperform large
caps in the Bull Run. On the flipside, they may not work in weak zone. And
small caps will get wiped off.
Ok,
so if you ask me what does the market say now? I say the bulls are not
exhausted yet. There is good scope for the Sensex to hit the 20 K levels. What
stocks look good to me? I say Onmobile Global, Shalimar paints, Dish TV,
Syndicate Bank, Polaris, Corporation Bank, MT Educare, Dena bank ( Above 105 –Target
125 ) , Motherson Sumi , NRB Bearings .( All on a upside of about 20% ).
So
markets are cruel but can be endearing. You can love them and hate them at the
same time. But I’m certain it’s difficult to leave them. So, I say we devour it by upgrading our
knowledge and skill sets. Because it’s an exciting place to be!!!
*** Disclaimer:
Invest in these stocks at your own risk and if you do book profits, send me
some***
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