Short email - 5 successful stock market habits.

Sep 19, 2022 12:46 am

Good morning my dear readers,


Yes, its a Monday, but look on the bright side, us 'Earth-lings' have to just endure this day for 24 hours.


A day on planet Venus lasts 243 earth days.


Now, aren't you glad that you are NOT some alien creature from Venus? Imagine Monday's lasting for 243 days 🤯.


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Today, we will keep the email short and focus on some good habits that I would want for you to note and stick on some wall in your office or home.


(Please take permission first from your wife or girlfriend before sticking posters in your house if you do not want beatings. I have learnt this the hard way 🤕).



1- Instead of normal SIP, do Opportunistic SIP.


  • Normal SIP is nice. But Opportunistic SIP is great. It means to add stocks on 5-7% decline from previous peak.



2- Never average or do SIP in a stock which is going down.


  • If the stock market is crashing and then if your stock is falling too, that is the PERFECT TIME to do Opportunistic SIP.
  • But, if the market is alright and if your stock is down, don't you DARE to average such a stock. (In most cases, this bad habit will give you significant losses).



3- Ensure that your portfolio has two factors working in your favour - A) Earnings Growth. B) Re-rating.


  • Basically aim to buy companies which are growing and also cheap. This is the ultimate formula of the stock market.



4- Book profits.


  • Not everything can become the next Infosys & TCS. Book profits and keep refreshing the portfolio every 2-3 years.
  • Refreshing the investment portfolio brings Alpha. - Joel Greenblatt.



5 - About timing your market entry. Well, just DON'T do this.


  • The FED first said that inflation is transitory, then they adamantly stuck to their guidance like a newbie trader which holds to his loss making position in fear of making loss.
  • The FED then became inflation hawks all of a sudden and now are busy raising interest rates while this inflation clearly is caused by Supply issues and nothing else.


Basically, if the sophisticated FED cannot predict inflation over 1-2 year period and neither should you bother about doing the same.


As we know, India will sell more Burgers every year for the next 20 years. And I am pretty sure it will be the same for Fans, Computers, UPI transactions etc.


India is a MASSIVE opportunity.



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Ps - What would you say about us launching a new 'Microcap+Smallcap focused PMS or AIF?'


Being a microcap fund, we would look at cap the PMS at a small AUM with limited clients.


Any thoughts if such a PMS/AIF would be a good idea or not?


*I have realized that some of my 'biggest' winners have come from Microcaps and Smallcaps. There is significant opportunity for investors in this segment.


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Did you know?


The jersey Michael Jordan wore for the first game of the 1998 NBA finals, which the Bulls won in Jordan’s “Last Dance,” sold for a record $10.1 million at auction.

(Approx 80 crore rupees)


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That is all from me today my friends.


I will talk about an interesting company on Friday when I am in a happier mood =)


On a serious note, it is an unprecedented India opportunity. Lets not take any risks like derivatives etc and invest properly with dedication.



God Speed,


Neil Bahal

Founder & CEO

Negen Capital PMS

Negen Capital Startup AIF





Comments
avatar Ramesh Shah
Hi Neil, I think Mid+Small cap PMS will be good idea as many can participate due to lower ticket size compared to AIF. But do give option to existing PMS subscribers to move to new PMS.
avatar Uday Nayak
Hi Neil, Sure its going to be a great idea. Best regards, Uday