| Author |
Message |
prosperity
Senior Member
Joined: 01/Sep/2006
Location: India
Online Status: Offline
Posts: 546
|
   Posted: 21/Sep/2006 at 6:31pm |
One more place is - when i decide to get out of a stock because of its fundamentals ... i try to get the best price market can give in next 2-3 months.. since i am unsure of what price market can give..
I try to sell the complete holdings in batches. Deversification of timings in selling (keeping within 2-3 months) helps me to NOT do a DISTRESS SALE !
This could be partial profit booking OR partial loss booking - whatever the case may be ... but since it does not continue to look fundamentally attractive .. i start selling in batches - avoid selling in 1 go ....
Reverse SIP, if you will :)
|
 IP Logged |
|
|
|
 |
|
Vivek Sukhani
Senior Member
Joined: 23/Jul/2006
Online Status: Offline
Posts: 6675
|
Posted: 21/Sep/2006 at 6:44pm |
|
Agree with you,prosperity. when unsure and yet not in distress adopt this startegy... Good Maxim!!!!!
|
|
IP Logged |
|
|
|
investor
Senior Member
Joined: 06/Sep/2006
Online Status: Offline
Posts: 1745
|
Posted: 21/Sep/2006 at 6:47pm |
Basant, i agree with you that its more mental than anything else, but like Vivek has pointed out, there is so much emotions associated with investing(contrary to th epopular belief that associate only traders with emotional actions) so its all part of the game! 
|
|
IP Logged |
|
|
|
Vivek Sukhani
Senior Member
Joined: 23/Jul/2006
Online Status: Offline
Posts: 6675
|
Posted: 21/Sep/2006 at 6:52pm |
Frankly speaking, I get more nervous when my picks do well more than what i had initially expected. I am more comfortable with slow moving companies rather than fast movers. So, I am at times forced to adopt this startegy as well. Its like this Basant, if my target for a company os 500 after 3 years and if its CMP is 200, and suppose if it jumps to 400 in 2 months time, I think we should make a partial exit...
|
|
IP Logged |
|
|
|
basant
Admin Group
Joined: 01/Jan/2006
Location: India
Online Status: Offline
Posts: 18403
|
Posted: 21/Sep/2006 at 7:00pm |
......... that is because we do not know why it has gone up and we are too worried not to lose the entire gain.
I look for terminal values only. A stock can run up ahead of itself and then correct 50%.... I am broadly prepared to take that notional loss so I generally like to hold on irrespective of these swings.
The bottomline is to have the research correct and if that is there we would not be tempted to sell. The question arises becauuse of the maxim
"When in doubt stay out"
Edited by basant - 21/Sep/2006 at 7:07pm
|
|
'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
|
|
IP Logged |
|
|
|
Vivek Sukhani
Senior Member
Joined: 23/Jul/2006
Online Status: Offline
Posts: 6675
|
Posted: 21/Sep/2006 at 7:05pm |
|
stay out means booking profits... albeit partially( there is a word doubt, so a partial rcit).... Am I correct?
|
|
IP Logged |
|
|
|
basant
Admin Group
Joined: 01/Jan/2006
Location: India
Online Status: Offline
Posts: 18403
|
Posted: 21/Sep/2006 at 7:08pm |
|
Yes stay out means "partial" in this case and it arises because of doubt a more crude word could be ignorance.
|
|
'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
|
|
IP Logged |
|
|
|
Vivek Sukhani
Senior Member
Joined: 23/Jul/2006
Online Status: Offline
Posts: 6675
|
Posted: 21/Sep/2006 at 9:36pm |
|
Basant, unfortunately we are not gods. Weare run by emotions and doubt is a very important event that happens to all of us. At a point of time, one becomes shaky. As Manish said, Hathi baicho bakri kharido... thats the startegy we adopt then. But then we dont sell the entire hathi... hence partial profits taking. there is a concept of inverted pyramiding.Also ignorance is a disease which we all suffer from.... only degree varies. How many stock gurus were cautious on Balrampur Chini when it was 200... how many were bearish on Sical Logisitcs when it was about 560 odd.... how many were bearish on gateway Distripaks when it was 265. Basant, this is one field which teaches us to be humble for I again repeat it at the cost of being over-repetitive, there is a very thin line between between confidence and over-confidence... and most of the mortals cross it very ignorantly. And needless to say, they repent it for the entire life time. And talking of great guns... my dad sold off a very pouplar scrip like SBI at 15000 (rs. 100 paid up) in 1992, and I am sorry to say in this period of 14 years the chap who bought this creme de la creme, would not at all enjoyed owning such a dead elephant.We all talk of sector leaders, when a thing runs out of steam.... where it goes no body knows. Basant, its better to be cautious( in your terminology, ignorant) rather than being confident. This is not a place for enthusiasm... here not only money and stocks are traded, here emotions are bought and sold. I have seen people losing their hats in this market by being over-confident.Basant, I dont want to become a critic, but then cant resist the temptation to pinch myself when i feel the going is so good.
|
|
IP Logged |
|
|
|
Active Topics
Memberlist
Calendar
Search
Help
Register
Login
