SHARING WITH RETAIL INVESTORS MY 14 OBSERVATIONS ABOUT INDIAN STOCK MARKETS

1. NEVER INVEST JUST THAT SOMEONE ADVISED YOU TO INVEST.DO NOT DEPEND ON TIPS.EVEN BIG PERSONS GIVING TIPS ON TV CHANNELS CNBC AWAAZ ALSO DISAPPEAR AND SPEECHLESS WHEN MARKET FALLS.

2. STUDY THE BUSINESS MODEL AND SCOPE OF FUTURE EARNINGS AND SPECIALLY GENERATION OF FREE CASH BY COMPANY.(FREE CASH MEANS PROFIT BEFORE DEPRECIATION BUT AFTER TAX AND ADJUST WORKING CAPITAL INCREASE AND DECREASE BETWEEN DATES OF COMPARISON) NET EFFECT WILL SHOW THE REAL CASH GENERATED BY COMPANY.REMAIN CAUTIOUS WITH COMPANY WITH VERY HIGH PE RATIO AS COMPARED TO PEERS AND INDUSTRY.

3. CHECK THE INTEGRITY OF PROMOTERS.

4. NEVER INVEST ON THURSDAY IN RISING MARKETS AS ON FRIDAY BROKERS PULL THE SHARES DOWN.BE CAREFUL IN INVESTING WHEN MARKETS RISE BEFORE STOCK EXCHANGES LONG HOLIDAYS.

5. INDIAN MARKET IS TRIPLE SANDWITCHED AMONG USA (CLOSING AFTER MIDNIGHT)–FOLLOWED BY ASIAN IN THE MORNING AND THEN MID DAY BY EUROPEAN AND HENCE THEY IMPACT OUR MARKETS.KEEP A TRACK ON THESE MARKETS.

6. READ MAIN NEWS PAPERS LIKE THE ECONOMIC TIMES/SITE LIKE MONEY CONTROL TO KEEP WATCH ON NEWS RELATED TO STOCK SPECIFIC COMPANIES.

7. AVOID PLAYING INTO DAY TO DAY TRADING AND F & O UNLESS YOU HAVE SURPLUS MONEY AND EXPERTISE.

8. INDIAN ECONOMY DEPENDS ON OIL PRICES-GOING UP GOOD FOR USA BUT NOT FOR INDIA.

9. IF YOU ARE SITTING ON GOOD PROFITS THEN TRY TO COME OUT AROUND DIWALI DAYS AS MUTUAL FUNDS AND FIIs LIQUIDATE SOME PERCENTAGE OF THEIR HOLDING 7 TO 10 DAYS BEFORE CHRISTMAS FOR DIVIDEND DISTRIBUTION TO INVESTORS.

10. INVEST IN COMPANIES HAVING REGULAR GOOD VOLUMES ON DAY TO DAY BASIS AS IT IS EASY TO COME OUT WHEN YOU NEED MONEY.

11. BE CAREFUL AT THE TIME OF BUYING AND SELLING THOSE SHARES WHERE THERE IS WIDE GAP BETWEEN SELLING AND BUYING PRICE QUOTES.

12. AND LAST A WORD OF CAUTION.STOCK MARKET CAN GIVE UNEXPECTED JERKS SO PLEASE MAKE SURE YOU HAVE SUFFIENT FUNDS PARKED SAFELY TO MEET YOUR DAY TO DAY EXPENSES FOR SURVIVAL.

13. COMING DAYS AFTER FEB 12 2018 ONWARDS COMPANIES DEFAULTING ON BANK LOANS WILL HAVE TO FOLLOW NCLT ROUTE AS RBI HAS ABOLISHED SO CALLED POPULAR SDR/CDRs SCHEMES BY BANKS JOINT LENDERS FORUM.

14.PROMOTERS' MANIPULATED STOCKS ARE MAXIMUM SMALL CAPS AND MID CAPS AND LISTED MAINLY ON BSE INDIA.