Is " Buy and Hold " Investing Dead ?

amitrandive

Well-Known Member
#1

About 95% stocks fail to cash in on bull run


http://epaper.timesofindia.com/Defa...0&PageLabel=21&EntityId=Ar02106&ViewMode=HTML



Is it a bull run or a mere index management? Well, the bull phase in the capital market is not as broadbased as it was in 2008 and has not percolated to 95% of the scrips, including a majority of the nifty blue chips. It has been confined to some 20-25 stocks with high weightage in the indices. Both nifty and the sensex touched all-time highs but a majority of the stocks, including a good chunk of those from the nifty are quoting at a 50%-80% discount compared to January-February 2008.
Retail investors and high networth individuals (HNIs) haven’t yet got any opportunity to book profit and still stuck with huge notional losses, feel experts. Interestingly, not only are a majority of the blue chip stocks languishing, the turnover of the cash segment at NSE has declined by over 50% compared to January 2008. The turnover in the cash segment was Rs 25,000 crore on January 8, 2008, when the nifty was at 6,287 while the average turnover in April was barely Rs 12,000-12,500 crore with nifty crossing the 6,500-mark.
The turnover of nifty future has also come down from Rs 19,340 crore in January 8, 2008 to Rs 13,284 crore in April. Considering a doubledigit inflation for a majority of the period for the last five years, the real turnover at 2008 value would be even lower. Kamal Parekh, the chairman of Stewart Securities, and former president of Calcutta Stock Exchange (CSE), feels that it is a market of 15 scrips and a few operators. “The retail investors were anyway not there. Now HNIs have also been trapped as most of the blue chips are quoting at a huge discount than the level achieved in 2008,” he added.
An analysis of the stock prices shows that nifty stocks like Tata Steel, SBI, Tata Motors, L&T, NTPC, Bhel, Hindalco, Bharti Airtel, DLF are quoting at much lower level than during 2008. The popular retail counters like Essar Oil, BEML, ITI, Shipping Corporation are also in a bad shape. Most of the mid-cap scrips are hitting their bottom. Ajit Khandelwal, the director of BNK Securities, pointed out that the rally so far has been confined to a few nifty stocks. “Retail investors who are already in the market have not gained,” he added.


Is Buy and Hold Investing dead???

I read an article in the Times of India today 10th May 2014.
My reasoning says, is if these are really fundamentally solid companies,buy and hold in them should have profited in the long run.

So the questions which are really bothering me are as follows,

1)Is "Buy and Hold" investing really dead?
2)Does the retail investor now have to think like a swing trader?
3)How to identify weakness in the companies,book profits/losses and exit at the right time?
4)For a long term investor what should be the frequency of portfolio review and portfolio churning?

Any suggestions/advice/help from seniors appreciated.
 
#2
Hi amit
I think that info is not complete. Splits bonus etc are not considerd.
suppose we take tata motors
in 2011 stock was splited from rs 10 to rs 2. So per share value became 1/5.
Taking current price of 230 , stock price is actually 230x5=1150 which is higher then 2008.
Yes there are few stocks like reliance where valuation is still low, but I think value is dependent on not only nifty but also on company fundamental.
So I think buy and hold is still there but invester favourite may change.
moreover I think nifty quote reflects total market cap of 50 companies and major investment is through equity..
 

amitrandive

Well-Known Member
#3
Hi amit
I think that info is not complete. Splits bonus etc are not considerd.
suppose we take tata motors
in 2011 stock was splited from rs 10 to rs 2. So per share value became 1/5.
Taking current price of 230 , stock price is actually 230x5=1150 which is higher then 2008.
Yes there are few stocks like reliance where valuation is still low, but I think value is dependent on not only nifty but also on company fundamental.
So I think buy and hold is still there but invester favourite may change.
moreover I think nifty quote reflects total market cap of 50 companies and major investment is through equity..
trader_ks

Thanks for your feedback.I assume the person who wrote this article may not have considered splits/right issues/dividends, etc.
:clap::clap::clap:
 

praveen taneja

Well-Known Member
#4
Actually day trader when trapped in stocks mostly become long term investors and they are due to mistake not by choice whenever they get chance to run away they exit by booking loss or a/c wipe out mostly after that there many generation dont look towards investing as a good option and chose MF or FD or PPF
 

prst

Well-Known Member
#5
Actually day trader when trapped in stocks mostly become long term investors and they are due to mistake not by choice whenever they get chance to run away they exit by booking loss or a/c wipe out mostly after that there many generation dont look towards investing as a good option and chose MF or FD or PPF
Index investing provides better safety against loss. One can use SIP
 

prst

Well-Known Member
#7
Actually day trader when trapped in stocks mostly become long term investors and they are due to mistake not by choice whenever they get chance to run away they exit by booking loss or a/c wipe out mostly after that there many generation dont look towards investing as a good option and chose MF or FD or PPF
Index investing provides better safety against loss. One can use SIP
 
#9
Investors are a class by themselves. We Traders can never understand that.

My Cousin has built his portfolio from last 30 years. Your heart beat will stop if get to know his buy prices of his portfolio.

Cheers....:D
I stared career as an Investor.......My capital.....become ....600% after 13 yrs.....Now.....I don't like Investing ...and quit Investing because of....Scandal and manipulation..........in stocks......:thumb:
 

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