Friends,
These are time of turmoils.Everyone is passing through it.I am also no exception.
People who invested through borrowing is facing the worst time ever.Over leverage should not be done at any cost.I have been writing this time and again here because I have passed through the same phase in my life.23 years in Indian stock market is no less an experiance.I have passed through everything. Lost my money , big money in stock market in past .I also made the mistake of borrowing money to invest in market and made the same mistake some of you are making now.I learned the hard way and seems you also will learn the hard way.
The main thing which one should learn is how to BOOK LOSS.
The whole world is seeing a capitulation.In recent times, means couple of days back, Brazil and Russian stock market were kept closed for 3 & 2 times each in 1 day.The fall was so big in one day that they have to be closed twice thrice in a day.
So from the BRIC nations, Brazil and Russia are almost gone.Now whose turn is it, is to be seen.Now left are India and China.Our market has still room to go down and that beware of A gr stocks which are of high price quoting at over rs 1000 levels like say Ril Ind,Grasim,L&T, Areva, etc etc.If the stock are 2 paid up or 1 paid up and if it is over rs 50 or 100 , means 500 or 1000 on 10 paidup will also be battered down in our market.Market has lost confidence.Even after the $700 bn bailout if US market is not showing sign of mercy how can we expect India to show resilience.When everyone wants to sell then there only one way and that is down.
I can't imagine how stocks can be available so cheap in just 9 months after a market makes a new high?Almost 70% of the stocks are available at half the BV or at 5 or below P/E.Maybe the P/E may contract more as the earnings may not come good but what about the BV?
Maybe there is still some poision left in A gr stocks and some cash gr stocks which are still high.So there is still room for our market to go down.
Well, someone asked me why I am not confessing or applauding Shankar Sharma about his downwards target he gave recently this year?They says I have critisized him.Now is the time to appreciate him.
Here is my answer:
I wants to know from him who advice me to appreciate SS that how many times SS went wrong in past?He went wrong in predicting the market more then 4-5 times.He was bearish since market crossed 7000 level.I remember seeing and hearing him.
I don't doubt his ability to see the things coming.He ofcourse is a great visioner but has failed to predict the market.His view is always good on some aspects.He brings new ideas and parametres as well and being a CA he is as good as RJ ,RA and likes.
But what I remember is he has proved wrong many times in this whole bull run right from 4000 to 21000.So has many others failed in past like Deepak and likes.
People have lost the opportunity to earn multiple returns when market was going up and they were sending bearish signals.Who is accountable for that?
In one of the interview at NDTV around 18th sep 08, which I see the most recent one, RJ says that 13700 is the bottom and market should take a good support from thereon.He was almost very confident that 12700 will never be breached.He went wrong in big way too.
Should I critiszie RJ? No! Why, because he has proved correct right from 5500 levels...about the bull market.....that unfolded upto 21k........and he still says that we have seen nothing.The mother of bull market is still to come and in that we may reach 40k.Shankar Sharma is still not telling that.He will never be able to tell because he is a BEAR.He never gives bullish target.He finds negatives and as soon as market goes up he will come out and give bearish views.
I can bet that.Just see what happen down the line 2-3 years.How many times he comes and gives view on market and of what type....
Well, coming back to market the easing of liquity due to infusion of $700 bn is going to create some confidence in US market.The hedge funds has lost money in Brazil and Russian markets, both are commodities market and they have tanked heavily.Hedge funds maybe shorting in US and India but they have lost billions in longs they created in Brazil, Russia and in Oils.
I remember SS came out with a bearish call on Oil at $110-115.That was no great.I gave a call much earlier about oil coming down.After the momentum breaks in bull cycle anyone can give the bearish call.
I think sooner or later the market should find its bottom.I wish best of luck to everyone.
No advice , no suggestions.............