I am a senior citizen, pretty old. In January 2007, I was sitting with stocks valued approx. Rs. 3 crores. Since then, there has been continuous erosion and today my portfolio is worth hardly Rs. 50 lakhs, apart from an investment of Rs. 17 lakhs for a flat (total cost 60 lakhs). Unable to chart the course for realising the dream of possessing a roof.
Since the fall, I have tried to study Technical Analysis, Fundamental approach, etc. Yet I do not see any light at the end of the tunnel. Now that time to depart is approaching nearer and nearer, there is a sense of urgency.
Mastering skill in Technical Analysis in a short time does not appear feasible. Like catching the falling knife, valuation based investment of what is left too is not so easy. Not knowing how to salvage my financials, the challenge matters seems to growing bigger and bigger.
One feels DEPRESSED and confused. Technical Analysis or Valuation based investing? Portfolio Management? Charting own way or placing funds with some Technical or Fundamental experts? What would be the optimum strategy?
Looking forward to receiving guidance from experts!
Hi RDS.
I presume 1933 is your birth year, and you are really Senior to all.
First and the most important thing that you should note : Try to stay relaxed. Which I know is NOT easy.
Second, considering that the erosion of stock related investment wealth was from 300 lacs to 50 lacs, there is nothing that can get you back all the money over night. So, it would be wise to find ways and means.
Third, the Mutual Funds are sitting tight because they have also gone through similar stage. almost all of them who are considered as experts to common man. Thats why the common man does NOT get into equities directly, but opts for MF route because it is assumed that MFs are run by experts.
So, even if you come across someone claiming to be an expert to get all the lost wealth back to you overnight or within a year, I would doubt it. Even if the person sounds very convincing, I may take a risk of not more than 5 lacs.
You have tried learning Technical Analysis, Fundamental analysis, etc. Good. But it shall not help you at this moment, because almost everything is down.
It is anticipated that the conditions shall continue to prevail till atleast March 2010.
So, I am giving below my comments for your consideration. It is your money, and you should be the person to decide about its re-investments.
First. The Fundamentals of many companies have been shaken up due to the Global situations. Few things one should always keep in mind for any company, are
- EPS or Earning Per Share
- Face Value & Book Value of the share
- P/E Ratio, which is the ratio of the Share Price existing in the market at any given time to the Earnings per Share.
If you buy only one copy of Capital Market or Dalal Street, it would give you these details. You could compare the companies under similar status, for example all PSU banks, all private banks, and check the differences and come to your own conclusion.
Using this info, check the status of the stocks that you are holding. You would find that here are some stocks, which are changing very less, but there are some other stocks, which are having a large change.
So, the Fundamentals help you in selecting the stocks to be bought or sold. The Technical shall tell you when they are to be bought or sold.
There are threads under Equity section in this Forum, where you could get comments about various stocks. The comments may or may not be from experts, so take your time to settle down in understanding this forum and the members comments.
It appears that you had invested everything only in Stocks. One should also keep the other options such as Gold, Real estate, Bank FDs, etc.
It is anticipated that the current price of US $ 840 per ounce may [repeat may] go up. If it crosses and stays above 1000 dollars per ounce, then it is expected to cross 1400 US $. But then, one needs to wait for that to happen. One ounce is little over 31 gms.
Alternatively, it may fall also. In that case, you could get 100g Pure Gold of 0.999% purity for less than one lac. This pure gold is available in sealed packs and for investment purposes only. So if one needs to sell them back, then there is no deduction towards the usage of gold, like it is done for the jewellery.
Finally, I would like to add that do not consider yourself as a person having failed in investing. You are not the only one. Many major financial institutions in USA have failed to a larger extent.
You should NOT have any guilty feeling what so ever. Remain cheerful. Spend the time in reading comments in different threads in this forum than listening to CNBC, NDTV, who only mis-guide [in my opinion, and I could be wrong]
Do NOT rush in taking any decision. Take your own time in ensuring that what you are going to do is correct. Be sure that nothing worse could happen overnight or even in weeks or months.
Stay relaxed. It will help you in taking a proper decision.
Cheers, Good Luck and Merry Christmas.