NIFTY and SENSEX have been scaling heights in recent months – that is true only if you look back last 6 months, or 12 months, or 24 months. But when you look back 2 years or 3 years, one would say, it is not a correct statement. In this context, the correct statement would be to say NIFTY and SENSEX are at same levels. You see how putting context or changing data set changes observations and conclusions. The point being, as an investor you have to learn how to “make an objective decision”. You have to learn how to “avoid making subjective decisions”. The current state of equity markets and economy provides a very good example of how to we make subjective decisions.
In last month or so, I have had an opportunity to interact with few folks on email. Many of these folks very interested to know whether it is time to sell any stocks in my portfolio e.g. ONGC, Reliance Capital, HDFC Bank, ABB, etc. Many of them wanted to check if it is time to book some profits. And few folks made a comment that Reliance Capital, NTPC, and ABCIL are not fundamentally strong for buy and hold portfolio. Continue reading rest of this article…
The above question can be framed differently as “Do I wait for next Downturn for Cheaper Valuation?”
At regular time intervals, I like to discuss selective questions from readers of this blog. Many times, I discuss randomly with no particular theme. It is usually based on either intriguing questions or inquisitive questions or just that I like the question. Now that markets have zoomed higher relative to last year, most of these questions have slowly drifted towards buying price. I give priority to respond to all questions that come from regular readers of my blog. I make sure I give them my best response. Others, I may or may not, depending upon if I have time to get to them or whether they are good questions. 
The 1H2010 can be summarized as return of optimism, in economy, in stock markets, stabilization of global economy, and fears about euro zone. As an individual investor, should I care about macro economics, or should I even worry about what happens to Greece or to euro currency? Ambani brothers patch up and there are stories its good for markets and business! To me, being stalwarts in India Business world, instead of setting an example, it was idiotic for them to even fight and drag each other into courts. These are good academic discussion, but I doubt it is going to help in your own portfolio. I am taking stock of my portfolio.
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