reducing losses and averaging

lawrieking · #1 2nd May 2008, 02:28 PM

GMRINF qty 1000 bought 216.27 CMP 164.20

JAICOR qty 200 bought 1,306.80 CMP 652.00

POWGRI qty 1000 bought 133.25 CMP 106.80

TORPOW qty 1000 bought 211.01 CMP 138.20

RELNAT qty 1500 bought 175.60 CMP 125.10

Hi friends i bought the above when the market was moving with a long term view. Market then fell to the lowest and my losses went deep. I didnt have much cash to buyout when the market went down so i could average and bring down the price. I now have the cash but i am skeptical where to invest in the above to average and bring down my losses. I want to buy JAI as i still feel in the long term it will payme back.
Can i have some help on the other stocks so i can go and buys some. Or is there likely to be dip which would make me another opportunity to buy at low.

I have the cash and i am patient.

need some serious advise if you can.

cheers and thanks in advance

sudoku1 · #2 2nd May 2008, 03:41 PM

Quote:

Originally Posted by lawrieking

GMRINF qty 1000 bought 216.27 CMP 164.20

JAICOR qty 200 bought 1,306.80 CMP 652.00

POWGRI qty 1000 bought 133.25 CMP 106.80

TORPOW qty 1000 bought 211.01 CMP 138.20

RELNAT qty 1500 bought 175.60 CMP 125.10

Hi friends i bought the above when the market was moving with a long term view. Market then fell to the lowest and my losses went deep. I didnt have much cash to buyout when the market went down so i could average and bring down the price. I now have the cash but i am skeptical where to invest in the above to average and bring down my losses. I want to buy JAI as i still feel in the long term it will payme back.
Can i have some help on the other stocks so i can go and buys some. Or is there likely to be dip which would make me another opportunity to buy at low.

if i were given the option in compulsion 2 make a call on the abv stocks......i would certainly liked 2 average the no 2 &no 3 stock in terms of quality...

lawrieking · #3 2nd May 2008, 08:14 PM

Quote:

Originally Posted by sudoku1

if i were given the option in compulsion 2 make a call on the abv stocks......i would certainly liked 2 average the no 2 &no 3 stock in terms of quality...

Thanks SUDOKU... whats your take on Torrent. Is this likely to go up with the speed it went up during the rally. Anyways i shall narrow down the 2 for now.

thanks your advise.

cheers

prabhjeetrana · #4 2nd May 2008, 08:30 PM

If you are a long term investor in real terms than I think you have not done your home work properly, if you look at all the scrips most of them are way above their book values, there is no sanity in PE ratios and profit/loss sheets of atleast RNRL looks horrible.

Please take some time reading Fundamental analysis books by Benjamin Graham then you will come to know what are the financials of company you should check before investments.

As far as my knowledge goes if you are real long term investor than VALUE should be the most important criteria for you

Vairam.Ed · #5 2nd May 2008, 09:42 PM

Hi,
Seems like you are under the assumption that averaging will bring down your loss. That's not the truth. Averaging out doesn't reduce your loss. Though after averaging, the buy price comes down but the actual loss amount is still remains the same(instead of lossing Rs.100 in one share, now you will loss Rs.50 on two shares, you final loss is still Rs.100). Do your own math.

Now if you believe the above statement, then why not invest in another stock instead of averaging. Atleast you can keep the risk down.

Sorry, I dont know anystocks to recomment.

Just 2 paise from this little fella...
Vairam.

Quote:

Originally Posted by lawrieking

GMRINF qty 1000 bought 216.27 CMP 164.20

JAICOR qty 200 bought 1,306.80 CMP 652.00

POWGRI qty 1000 bought 133.25 CMP 106.80

TORPOW qty 1000 bought 211.01 CMP 138.20

RELNAT qty 1500 bought 175.60 CMP 125.10

Hi friends i bought the above when the market was moving with a long term view. Market then fell to the lowest and my losses went deep. I didnt have much cash to buyout when the market went down so i could average and bring down the price. I now have the cash but i am skeptical where to invest in the above to average and bring down my losses. I want to buy JAI as i still feel in the long term it will payme back.
Can i have some help on the other stocks so i can go and buys some. Or is there likely to be dip which would make me another opportunity to buy at low.

I have the cash and i am patient.

need some serious advise if you can.

cheers and thanks in advance

deb99891 · #6 2nd May 2008, 09:48 PM

Quote:

Originally Posted by lawrieking

GMRINF qty 1000 bought 216.27 CMP 164.20

JAICOR qty 200 bought 1,306.80 CMP 652.00

POWGRI qty 1000 bought 133.25 CMP 106.80

TORPOW qty 1000 bought 211.01 CMP 138.20

RELNAT qty 1500 bought 175.60 CMP 125.10

Hi friends i bought the above when the market was moving with a long term view. Market then fell to the lowest and my losses went deep. I didnt have much cash to buyout when the market went down so i could average and bring down the price. I now have the cash but i am skeptical where to invest in the above to average and bring down my losses. I want to buy JAI as i still feel in the long term it will payme back.
Can i have some help on the other stocks so i can go and buys some. Or is there likely to be dip which would make me another opportunity to buy at low.

I have the cash and i am patient.

need some serious advise if you can.

cheers and thanks in advance

market postmortem do not give any dividend.
as a trader we want smaller but sure/high probable profit as u call it.
if u r an investor then do not ask any question to any trader.
do ur own analysis and stick to ur plan my friend.
as i am a trader my father do not take any advice from me as he is a successful serious investor since long time.
but when he take any trading buy he come to me for my comment and then we discuss a lot..esp.. on chart patterns.
this is hard fact i learned from my father who is also my teacher.
got the point?
opposite for traders.
traders buy high to sell higher or shortsell low to cover lower all with tight stop.
by the very nature of this site this is meant for traders/prospective traders..
u were in need of serious advice so i post this one .
regards

deb99891 · #7 2nd May 2008, 10:08 PM

Quote:

Originally Posted by prabhjeetrana

If you are a long term investor in real terms than I think you have not done your home work properly, if you look at all the scrips most of them are way above their book values, there is no sanity in PE ratios and profit/loss sheets of atleast RNRL looks horrible.

Please take some time reading Fundamental analysis books by Benjamin Graham then you will come to know what are the financials of company you should check before investments.

As far as my knowledge goes if you are real long term investor than VALUE should be the most important criteria for you

does not matter
this all are wave count.
1st value players come then growth players come....natural phenomenon
both are investors in terms of M.Fs and other institutional players or HNI local operators as the case may be.
regards

bamks · #8 2nd May 2008, 11:52 PM

If I would have been in your place I would have let the shares above be where they are. The investment was ok so far as i can see the timing was wrong. the new cash should now be be diversied into different sectors. it would be a very bad idea to remain fully invested.
these are my humble suggestions.

bamks

columbus · #9 3rd May 2008, 12:07 AM

Quote:

Originally Posted by Vairam.Ed

Hi,
Seems like you are under the assumption that averaging will bring down your loss. That's not the truth. Averaging out doesn't reduce your loss. Though after averaging, the buy price comes down but the actual loss amount is still remains the same(instead of lossing Rs.100 in one share, now you will loss Rs.50 on two shares, you final loss is still Rs.100). Do your own math.
Vairam.

I agree with Vairam.Instead of going for averaging ,better OPTION would be buying another good stock.

drpsiva · #10 3rd May 2008, 12:09 AM

averaging your losses is one of the dangerous mistakes, atleast in the world of stocks .this is what i have been taught thoeritically and practically by the markets.