Never buy a cyclical for the long term

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Topic: Never buy a cyclical for the long term

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deveshkayal
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Joined: 04/Sep/2006
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Posted: 11/Feb/2007 at 10:32am

Originally posted by mukesham

Today sugar stocks are treated as untouchables.No one is at all optimistic.Pessimism pervades at every level whether one sees the april or june sugar futures at NCDEX or reads the interview of those who are controlling sugar majors or any of the brokerages's research reports or listens the technical analysts.Does anyone at TED is looking at sugar stocks as a value investors or classic contrarian investor.Does't Balrampur Chinni or bajaj Hindustan merits investment on replacement cost basis?

Dont buy Commodities.Thats what i learned from TED.Adviced friends not to apply for Cairn. Thank God i sold Bajaj Hindusthan at 242 after having purchased it for 350.

"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett

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BubbleVision
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Joined: 05/Aug/2006
Location: India
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Posts: 3142

Posted: 12/Feb/2007 at 12:19pm

Devesh - I would slightly change your post ...Dont buy Commodities..If you dont understand.

You can't make money if you are unwilling to lose...It's like willing to breathe in but not willing to breathe out. -- ED SEYKOTA ....Read Disclaimer!

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basant
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Posted: 03/Apr/2007 at 10:36am

I think the increase in interest rate would hit all cycliclas but only upto a point. SO if anyone is severely bearish on Tata Motors he should first see that tata Motors has corrected from Rs 1000 to Rs 670 so from Rs 670 it could go down a bit but becoming bearish just because interest rates have gone up is no use. Markets have a habit of discounting things fast and early.

Enam is bullish on Tata Motors for the longer term though.

'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in

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praveenmbd
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Joined: 19/Jan/2007
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Posted: 04/Apr/2007 at 4:10pm

I have learnt a lesson after joining TED that never buy cyclicals and commodities.Sugar, cement and metal have wiped off poor investors hard earned money.

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basant
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Posted: 04/Apr/2007 at 4:28pm

Originally posted by praveenmbd

I have learnt a lesson after joining TED that never buy cyclicals and commodities.Sugar, cement and metal have wiped off poor investors hard earned money.

.....and the worst part is that everything looks so helplessly beyond control. kamal Nath to Chidambaram to Corus. There are simply too many variables to make consistently successful bets.

'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in

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sanjay3
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Joined: 20/Aug/2006
Location: India
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Posted: 04/Apr/2007 at 4:58pm

Originally posted by praveenmbd

I have learnt a lesson after joining TED that never buy cyclicals and commodities.Sugar, cement and metal have wiped off poor investors hard earned money.

same thinking here very first thing i did after joinin TED slowly i moved out from metal and sugar

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vijinat
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Joined: 18/Sep/2006
Location: India
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Posts: 112

Posted: 04/Apr/2007 at 7:46pm

I would like my friends to go thro the following:

"I am very positive on the Indian story. We have already spent over Rs.10000 crores in the last two years in creating global scales. We have now committed a further Rs.20000 crores on new projects in ................(their various products). Work is in full swing at all our projects and we expect to complete all projects in time and within budgeted costs. We have established our capabilities in establishing global scales at lower than benchmark capital costs and time.

We would look at spending $2 billion to acquire more .... in East Europe and also in Latin America. We want to minimise our raw material costs.

We believe our strength lies upstream. Backward integration is the way forward for us.

Our .... business is the third lowest cost and we have the third largest .... .... in the world.The group is on track to become one of the lowest cost generated ......... companies in the world. The operating mantra is IF ALL HAVE TO DIE, WE MUST BE THE LAST TO DIE."

I do not remember to have heard about TEDdies talking about this man.(I am not complaining) Guess who it is.

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kanagala
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Joined: 31/Mar/2007
Location: India
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Posts: 1229

Posted: 18/Apr/2007 at 12:06pm

Hi Basant sir,
Thanks for your reply. I am trying to find out Shipbuilding industry?
Is ship building industry (ABG & Bharati) considered as a cyclic?

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