Restrictions on Govt Servants

[comm4300]

Yesterday the net was slow, i could not see your charts. I try to give explanation of Cairn because it has not given any pull back rally to exit. A typical black swan event.

Recent peak was 380 and then it continued to fall. So, our first entry is at 304. (20% down from peak). So your investment in the scrip is Rs.304. Your next entry is at 228. Third entry is at 152. Here one important clue. Third entry point is 152 which is half of your initial investment. So, now you can buy 2 shares for same investment of Rs.304. (But in case of your second entry an amount of Rs.76 is still lying in the bank). If the scrip tanks by another 20% ie Rs.76 you will have funds to buy 5 shares. But it has not come there. Now it is hovering around Rs.160. But your average price is Rs.209. That is present price is just 23% in discount from average price.

All we want is a 100% rise from last averaged price ie from 152 to 304 in the years to come.

Now, simply challenge the scrip.... say to it. "Give me the return or tank to zero and vanish".

Guess what?

can you also elaborate profit taking using the same example? Assuming cairn takes off from here....

 

[suri112000]

I often use this link to check for opportunities.

 

[suri112000]

While booking profits tax implications are also to be counted. If you book profits in short term, you need to pay 20% capital gains tax on the profits made. If your holding period is more than one year, then there is no tax.

Profit booking can be made as follows assuming you are a very long term investor:-

Suppose your entries in the scrip are as follows. For example at each level you have invested Rs.10k. As the price moves down you tend to accumulate more number of shares at each slot.

100
80
60
40
20

When price moves from 20 to 40, exit your holdings at 20. Suppose after booking at 40, if price moves back down to 20 again buy them.

In case price moves from 20 to 120 straight away, you are out of scrip totally. Wait for some good retracement to start over again.

I am in SIP mode as discussed above of the following as a basket of shares below Rs.100. Atleast they will not vanish from Indian Industry in the next 10 to 20 years. (Other basket of investments are in the range of Rs.500, Rs.1000, Rs.2000).

HDIL
Reliance Power
GNFC
India Cement
Rico Auto
Spice Jet
ABG Shipyard
Ashok Leyland
JSW Energy
Nalco

 

[tradedatrend]

One correction, it is 15% tax on STCG u/s 111A

While booking profits tax implications are also to be counted. If you book profits in short term, you need to pay 20% capital gains tax on the profits made.