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mr.amd
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   Posted: 06/Mar/2008 at 9:08pm |
Now that dow as well as all europian markets are down today, it seems that sensenx will tank again tomorrow. So tomorrow might present a good buying opportunity.
Its an excellent analysis from Basantji, but I got no spare money left to invest  , as I am now sitting on a loss of about 12% now(this happened over last week). Unlesss I sell some shares at a loss and buy some new ones from proceeds, People like me have no option but to ride the wave and get down when its safe to do so.
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basant
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Posted: 06/Mar/2008 at 9:27pm |
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Hey, my article does not mean that we will start moving up from tomorrow. It is more of a statement of risk - reward from these levels.
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'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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Ajith
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Posted: 06/Mar/2008 at 9:29pm |
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Averaging down-especially with leverage- can turn out to be a foolish strategy as many have discovered in earlier meltdowns.
As far as I am concerned,the biggest risk is the Dow not adequately falling to discount bad times ahead.If it had fallen steeply enough the Sensex would by now have decoupled and we could say more confidently that it may be an opportune time to buy.Now only the brave will venture to buy and they may or may not have to face a torrid time ahead......
Edited by Ajith - 06/Mar/2008 at 9:44pm
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Mr. V
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Posted: 06/Mar/2008 at 9:41pm |
Excellent thesis.
I agree that with Investment & Savings rate at 34-36%, GDP growth of 9% is quite feasible.
But what do you think about the substantial slowdown in the manufacturing and IIP numbers that we have witnessed over the last few months ?
Do you think the GDP coming down to 8.5% from 9.6%(FY06-FY07) completely captures and reflects the IIP slowdown ?
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tigershark
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Posted: 06/Mar/2008 at 9:51pm |
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[QUOTE=Mohan]Basantji,
Excellent writeup.
Based on this perspective we should review the outlook on individual stocks in Ted XI and see if the story has changed on any of them. ie. fundamentally and/or growth/valuation basis. [/QU to do this we may have to wait for a month or so .q4 results and guidance if any will tell us if pe is contracting selling if done bfor that would be like playing blind.what do you think
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understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things
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basant
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Posted: 06/Mar/2008 at 9:53pm |
It could for a year but if interest rates are cut GDP will bounce back. As it is we will see increased spending because goods become cheaper on one end (tax cuts) and people have more money on the other (change in tax slabs).The biggest money will be made in companies that cater to a domestic audiance.
Now I have heard plenty of people talk about markets falling even while the economy was growing. In all those instances markets fell because they were driven up to 35 to 70 times earnings!!!
Can we fall from a 14 PE market and become a 7 PE market. If that is the premise then I am willing to bet against a 7 PE market.
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'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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tigershark
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Posted: 06/Mar/2008 at 9:56pm |
Originally posted by Vivek Sukhani
Although I have no clue what will happen tomorrow, but 2 of our big companies are likely to be good beneficiary of such high crude prices-Reliance Industries and ONGC. If these 2 do well from here, indices can surely do well. Another set of companies which may play the role of oxygen in the fire can be a HUL and an ITC. Also, Hero and Bajaj Auto may start kicking.....so true, markets may surely do well from hereon. Banking, IT may continue to sluggish becuse of their US overhang.
If I can recognise one theme gradually appearing on the horizon, it will be cognisance of the resource crunch which we will be facing if we continue with our lives like we are doing. So, companies holding such prized assets like crude, metals, minerals shall do well. Along with them, companies which facilitate better harnessing or better exploitation of such critical resources should also do well . And companies which are into the business of developing alternatives to such critical resources should also do well..... |
RELIANCE IND?people seem to have forgotten this company these days see how things change emotionally in just 2 months!obiviously a major beneficiary of rising crude and gas prices
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understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things
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Ajith
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Posted: 06/Mar/2008 at 10:09pm |
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A 10-20 percent fall in Sensex from current levels is possible from current levels given the current outlook and thats keeping marketmen on the sidelines.Its a tossup as to which way sentiment will swing in the short-run.
Personally,I hope to zero in on a range of stocks that will buck even a falling trend and thats what TED focuses on and thats great.
Also to remember is that in a message board if one says banking stocks are good and next moment there should be flexibility to change one's opinion(this does not happen as often as one would like and that is not quite right) and this is just an example to illustrate the point of herd mentality that
can come about .
Edited by Ajith - 06/Mar/2008 at 10:12pm
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