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Message Icon Topic: 2012 so far – The year of the Dirty Picture Post Reply Post New Topic
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koolvalue
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Quote koolvalue Replybullet Posted: 19/Feb/2012 at 8:11pm
This highlights one thing that good or dirty all stocks
are cyclical and trick is identifying next cycle---
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subu76
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Quote subu76 Replybullet Posted: 19/Feb/2012 at 8:45pm
Originally posted by luke123

I think if JP stops here then your point may be valid but if JP goes back to 200??

Another way to look at it is there is close to 0 chance of Page going to 10000 this year but a reasonable 25-30% chance of JP going to 200 if the market maintains its momentum

The differnece is not between 40% & 75%. The difference is between 40% and a 1000% (in real ugly names).

The point to concede is there is no way of timing the bottoms and over the long term it makes sense to be in Titan than JP. The people who have made money in these stocks in this rally are the people like me who got stuck in them because they never sold them.
 
I have spent 4 miserable years owning Indiabulls. I might eventually make more money than consumer guys(Page, hawkins) but I would have been far happier owning Page than Indiabulls.
 
If the rally continues(a big IF), I think this might be the year of the UGLY where the UGLY companies make 400-500% while the GOOD ones make their standard 25-30%.
 
What say??
 
Luke
 
 
 
 
Your points are insightful as always based on real life experience..
 
Hitesh Bhai made a similar point the other day...
 
Copy pasting here in case folks missed it
 
 
Originally posted by hit2710

Originally posted by subu76

The biggest NIFTY gainers in 2012 so far are Lanco Infcratech, HDIL, IFCI, Jet Airways and JSW Energy. (in that order)


I think one needs to see how much the stocks have fallen from their tops to get an idea about wealth erosion they have done for their investors.

Lanco Dec 07 high 89--- Aug 2010 high 75 -- recent low 8.45--- cmp 23. Now in this scenario it needs to be seen how many people had the courage and conviction and latched on to the stock at sub 10 levels. If some poor guy had bought the stock on its way down at around 25, thinking he is buying at one third the price of recent high of 75, then he is still in the red to some extent. Same applies to all the stocks listed above.
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FutureBull
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Quote FutureBull Replybullet Posted: 19/Feb/2012 at 9:15pm
Thanks Basantji for this timely article!! I just think that in stock market there is tendency to revert to mean.

I have a question to ask like everyone else. Is this a new bull market or just final bounce before most of the stocks including beaten down names go for final capitulation. In 2009 too market went up and beaten down names were multibaggers but that was not sustainable in hindsight. Is this different? Again, we will know in hindsight but the way tainted names (ADAG grp etc) have gone up doesn't bode well for all of us.
‘The market always does what it’s supposed to — BUT NEVER WHEN’.
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luke123
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Quote luke123 Replybullet Posted: 19/Feb/2012 at 9:23pm
Originally posted by FutureBull

Thanks Basantji for this timely article!! I just think that in stock market there is tendency to revert to mean.

I have a question to ask like everyone else. Is this a new bull market or just final bounce before most of the stocks including beaten down names go for final capitulation. In 2009 too market went up and beaten down names were multibaggers but that was not sustainable in hindsight. Is this different? Again, we will know in hindsight but the way tainted names (ADAG grp etc) have gone up doesn't bode well for all of us.
 
There is really no way to know. That will be decided after the fact. In 2014, we will say if 2012 was Bull market or just an upward move that fizzled out.
 
Luke
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subu76
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Quote subu76 Replybullet Posted: 19/Feb/2012 at 8:00am
Originally posted by koolvalue

This highlights one thing that good or dirty all stocks
are cyclical and trick is identifying next cycle---
 
I agree with the first part of your post....
 
The Second part is hindsight wisdom as posted by most folks.
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shontou
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Quote shontou Replybullet Posted: 19/Feb/2012 at 8:36am
Very aptly put Basant Sir.

These so called financial experts ascribe every upward stock market movement to liquidity just like our politicians blame Pakistan for every small cracker that goes off in any part of country!!!
Every day, self-proclaimed stock market "experts" tell us why the market just went up or down, as if they really knew. So where were they yesterday?
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dhananjayan1978
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Quote dhananjayan1978 Replybullet Posted: 19/Feb/2012 at 9:49am
Well said. There is lot of dirty money in the current market.
Dhanan
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prabhakarkudva
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Quote prabhakarkudva Replybullet Posted: 19/Feb/2012 at 11:18am
The key point that we all never focus on and that Basantji is highlighting here is, how much allocation can you make to these potential 1000 percenters.

Its easy to figure that if something has fallen from 200 to 10 then potentially it will bounce back much faster - but can you allocate 30% of your portfolio to it and see it go from 10 to 7 and then from 7 to 30, then back to 15 and then to 45 and so on.It will drain us emotionally.

So instead of making a 5% allocation and a five bagger in a bad name, do a 30% allocation in a good name and you just need a doubler to achieve the same absolute result. I think that is the jist of the article.
Take your chances and keep them in a box until a quieter time.
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