TIP Guy
6 March 2010
life
It has been close to 50 minutes, DS and I not only recognized each other, but it also looked like we were back to our old days when we would just go on and on about stock market ideas. In my last post, I stopped at when DS mentioned how he attempted to maintain two different types of portfolio, one for trading and one for long term portfolio. So the conversation continues….
I said, “DS, I have been fascinated, and quietly toyed with the idea of having such different portfolios”, “But wait before you get any ideas”.
You see folks, I wanted to add my disclaimer like we do in all walks of life, so I add, “I have not used it, but I am fascinated by this thought”. Before I say anything else, he jumps in. Continue reading rest of this article…
TIP Guy
20 February 2010
life
I am sitting at Singapore’s Changi International Airport. It is middle of the night, and I come to know my flight is delayed by four hours for technical reasons. I was contemplating what should I do. Made few personal calls and then I decide to munch on unhealthy burger and some fries. I was getting bored, so I started browsing the internet. I log into my blog’s wordpress interface and opened another tab with my blog. I was hoping to answer my emails and blog comments. That just remained a hope.
While I was reading comments, an Indian gentleman came and said, “may I sit here” pointing a chair just across me. I said, “sure, be my guest”. We exchanged few more pleasantries, and then each of us continued doing our own stuff. He started playing with his blackberry, and I turned my eyes to my computer. At the same time, I am thinking, there is no one around in this cafeteria, tons of empty chairs, so why this guy came just next to me. Usually, we just go and sit in an empty space.
I said to myself, “hmm, forget it, why bother”. I went back to reading comments and emails.
Few minutes later, he stops playing with his blackberry. He is looking around. I can sense he wants to talk to me. The moment I raise my head, he says, “The blog you are reading is awesome. Isn’t it?” Continue reading rest of this article…
Praj Industies (PRAJIND) provides turnkey plants and equipments for fermentation and distillation systems used in bio fuels processing (primarily ethanol related). It sells it products domestic Indian markets (about 70% market share), South East Asia (about 50% market share), and Europe (about 30% market share). It has been attempting to diversify in Brazilian and North American market but is still in very early investment/growth phase.
In addition to geographic diversification, it has also attempting at product diversification. It has begun working in other areas like Brewers, Agro Chemicals, Bio Chemicals, and Health and Wellness Products,
Praj Industries is small cap company. My objective here is to understand, if it will fit in my long term buy and hold portfolio. I like it because of very low debt.
Trend Analysis
The whole reason for any business to exist is to generate sales revenue and make more profits. At a minimum, the parameters listed below should have continuously increasing trends. All the data below is from 2000 to 2009. Continue reading rest of this article…
In my last post, I discussed about my fair valuation for buying and how it would be likely different than selling value. I tried to make a case that I would like to minimize my cost basis and maximize my sell price. Buying is easy because minimizing cost basis is under my control. Nobody can force me to buy high unless I want to do it, right? However, when it comes to selling I do not have any control. Like everybody else, I would like to sell high, but there has to be somebody willing to pay for it? And hence, it is little bit of subjective.
Furthermore, I identified three companies viz. HDFC Bank, Pidilite, and ABB, as stocks that I would consider as fairly valued for selling. OR likely to be tad over valued. I do not consider them to be extremely overvalued. In this post, I do not intend to discuss (or present an argument) what would I consider over priced or extreme overvaluation. No two people will come up with same conclusion. Continue reading rest of this article…
In today’s post, I am continuing my discussion on selling aspects for my long term buy and hold portfolio. To me, buying is always a very easy decision. Easy in a sense that I have few quantitative metrics and qualitative aspect that help me decide whether I should buy a given stock. However, I do not have such fixed metrics that tells me, hey buddy, its time to sell. For me selling is a very subjective process. I touched upon few guidelines that help me make a sell decision.
Discussing and presenting my thoughts on this blogs helps this subjective process. The comments and conversations I have with readers of this blog helps (or influences?) this subjective process. When I say influences, I mean influencing the thought process, and not directly sell a stock because my blog reader says so. Continue reading rest of this article…
Ask this question to people across different spectrum and you will get as many answers as there are spectrums.
- Conservatives will tell you stock market is nothing short of gambling. It demonstrates lack of understanding what stock market really means.
- Broker will tell you buy today, sell tomorrow. It shows what is the motivation; jacking up transactions and fees. Holding for more than few days is not in his interest.
- I can go on an on like this …. but you get the point. Right?
We all want to succeed in making some good money, some quick money, and/or some money. It is my belief that most of the individuals will lose money in stock market over their lifetime. Whether we admit it publicly or not, it is a reality. I do not doubt that people sincerely want to succeed at investing, but the only issue is they do not know how. So they try to follow something that appears to be succeeding. A fund manager or business honcho mentions some stocks or strategy that is doing good in the market, and they jump on board. Only to realize later that they are late to the party. With little drop they jump off and then try to latch on something else, or many times they say, “I am out of the market”. It is a fashion to use market lingo’s. Continue reading rest of this article…
It has been very close to a year I have been writing on this blog. Almost on all occasions I have discussed about buying and holding my position. I have said multiple times that I tend not to sell my positions. There have been multiple questions about why not book profits? Why not sell profitable positions and invest in other opportunities? Before I discuss on selling any positions, let me clarify, I do not blindly believe that buy and hold is holy grail for long term investing. I have no misconception about “not selling” any positions. In any system (eco-system, car, machines, or even our body), there are multiple elements and each have a role to play. Similarly, in portfolio management process, selling a position is also very important, and hence it cannot be ignored. In my process description, I have captured this part as ‘exit plan’. Continue reading rest of this article…
TIP Guy
22 January 2010
review
By now, I am sure most of us would have finished taking stock of Year 2009. I am also sure that many of us would be happy with our portfolio performance with 25%+ returns in single year. Many of us don’t lose an opportunity to say I made such-n-such in 2009. On a personal note, I also discussed the results of my own portfolio and showed 115% increase in market value. It would be very easy for me to brag that I did much better than market, which was 72%. However, that’s not what this is about. I do not know about others, but when I put my 2009 portfolio performance in the context of my long term vision, in the context of overall objectives, in context of my journey to build wealth, then I know getting 100%+ returns is nothing special. Let me discuss what I mean.
One of my objectives is to continue to have yearly returns in the range of 12% to 18%. And I have said on many occasions, for me, consistency and sustainability is very important. For ease of calculation, let us say, I am looking for 15% of consistent return year after year. Continue reading rest of this article…
