MEMBER'S LOGINX
| Invalid Username / Password | ||||||||
| Invalid Captcha | ||||||||
|
||||||||
| Sign Up | Forgot Password? | ||||||||
India's Third Giant Leap
This Could be One of the Biggest Opportunities for Investors
- Home
- Todays Market
- Indian Stock Market News August 11, 2011
Lessons from a smart investor Thu, 11 Aug Pre-Open
The world stock markets saw its worst fall since 2008 after Standard and Poor (S&P) downgraded United States credit rating by one notch to AA+. This sent shockwaves across world markets and ignited fears of a double dip recession. The debt situation in Europe also added spark to the fire. Indian markets also followed the world markets and saw a sharp downfall.
But in the middle of all the panic selling, there were few smart investors who saw this as an opportunity to buy heavily and make money.
One such smart investor was Life India Corporation (LIC). LIC, the country's biggest investor has often been used by the government to stabilize the stock markets whenever it gets wobbly. LIC bought heavily when the markets crashed in the last three days. LIC had bought stocks worth Rs 1.2 bn over the first four months of this fiscal but raised it to Rs 3.3 bn in the last three days alone when markets crashed and valuations became more attractive.
So is there any lesson one should learn from LIC? If one were to go by history and bought into the Indian stock market in September 2001 just after the 9/11 attacks, one would have made 84% over the next three years and 316% in five years. And if one was bold enough to buy Indian stocks during the collapse of the Lehman Brothers in September 2008; one would have made 61% in three years. There is no rocket science to buying when everyone around you is selling. One should always remember good returns will materialize over time on investments made at cheap valuations.
While investing, remember always that the stock price is not real. It is what other people perceive to be real. When investing, understand the company and the industry it is in. You can always grab a bargain when the stock price falls. The long term fundamentals are still the same but you are getting it at a cheaper rate. But if you put your money without knowing company's financials or even the type of industry, then you might as well put your money on a casino table, because the odds of your winning are just about the same.
For information on how to pick stocks that have the potential to deliver big returns, download our special report now!
Read the latest Market Commentary
Indian Share Market Update: Top Gainers and Losers
Equitymaster requests your view! Post a comment on "Lessons from a smart investor". Click here!
1 Responses to "Lessons from a smart investor"
ABOUT EQUITYMASTER
Since 1996, Equitymaster has been the source for honest and credible opinions on investing in India. With solid research and in-depth analysis Equitymaster is dedicated towards making its readers- smarter, more confident and richer every day. Here's why hundreds of thousands of readers spread across more than 70 countries Trust Equitymaster.
PREMIUM PRODUCTS
QUICK LINKS
POPULAR TOPICS
- Multibagger Penny Stocks
- Basics of Value Investing
- Benjamin Graham
- How to Invest in Gold
- How to Invest in Silver
- Best Stocks to Buy Today
- Best Small-cap Stocks to Buy
- Best Bluechip Stocks to Buy
- Guide to Penny Stocks
- How to Invest in the Share Market
- Warren Buffett - The Value Investor
- Pick the Best Multibagger Stocks
TRENDING TOPICS
Copyright © Equitymaster Research Private Limited (formerly Equitymaster Agora Research Private Limited).
Whitelist | Refer | Terms | Privacy | Contact | About | Sitemap
Equitymaster Research Private Limited (formerly Equitymaster Agora Research Private Limited) (Research Analyst)
SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Email: info@equitymaster.com. Website: www.equitymaster.com.
CIN:U74999MH2007PTC175407
Name of the Compliance & Grievance Officer: Ms Sonal Ramachandran
Telephone: +91-22-61434003 | Email: compliance@equitymaster.com
LEGAL DISCLAIMER:
Investment in securities market are subject to market risks. Read all the related documents carefully before investing.
Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.
All rights reserved. Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.
Equitymaster Research Private Limited (formerly Equitymaster Agora Research Private Limited) (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA, Canada or the European Union countries, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.
Ram
Aug 12, 2011Even with your recommendations , it looks like putting money on casino table.