I believe I've posted this topic in the right place.
Recently, i had an discussion [argument] with one of my trader friends about way and strategies to invest. The outcome intrigued me a bit.
w/o going into much details about the strategy adopted, here's what my friend does:
=> He invests in Cash market.
=> Only bluechip companies.
=> If he gets 15-20% return on his investments, he books his profit.
=> He again invests in bluechip company. The cycle goes on.
=> No F&O at all.
Here's what his DAD does:
=> He invests in Cash market.
=> Only bluechip companies.
=> Once his investment grows, he takes out his original capital by booking the required number of shares and forgets the rest. [literally forgets].
=> Original capital is then recycled into another bluechip investment. and the cycle continues. Thus my friend's dad has a small basket of FREE portfolio built up over the years. Unfortunately, the Free shares are just around 10 to 15 per scrip.
I personally liked this kind of investment. However, my friend says "what is the use of 10-15 free shares lying idel in your demat account while you could've booked total profit and probably invested more? [and eventually earned more]"
Friends:
#1. what is your opinion on this front? considering i'd want a similar free portfolio built up for a very long term [probably hand it over to my grandson]??
#2. How about tweaking it a bit? What if i buy 2 lots of call option of the identified scrip and book one while exercising other in case of profit?? [loss on option would mean shifting to another scrip for similar strategy]
your opinion will help.
thanks.
Recently, i had an discussion [argument] with one of my trader friends about way and strategies to invest. The outcome intrigued me a bit.
w/o going into much details about the strategy adopted, here's what my friend does:
=> He invests in Cash market.
=> Only bluechip companies.
=> If he gets 15-20% return on his investments, he books his profit.
=> He again invests in bluechip company. The cycle goes on.
=> No F&O at all.
Here's what his DAD does:
=> He invests in Cash market.
=> Only bluechip companies.
=> Once his investment grows, he takes out his original capital by booking the required number of shares and forgets the rest. [literally forgets].
=> Original capital is then recycled into another bluechip investment. and the cycle continues. Thus my friend's dad has a small basket of FREE portfolio built up over the years. Unfortunately, the Free shares are just around 10 to 15 per scrip.
I personally liked this kind of investment. However, my friend says "what is the use of 10-15 free shares lying idel in your demat account while you could've booked total profit and probably invested more? [and eventually earned more]"
Friends:
#1. what is your opinion on this front? considering i'd want a similar free portfolio built up for a very long term [probably hand it over to my grandson]??
#2. How about tweaking it a bit? What if i buy 2 lots of call option of the identified scrip and book one while exercising other in case of profit?? [loss on option would mean shifting to another scrip for similar strategy]
your opinion will help.
thanks.