Skip to main content

Some tips for individual investors for investment planning

These days, the stock markets are quite volatile in nature with a bearish bias. Rallies do not last long in the markets and peaks of market rallies are reducing. The markets are hitting fresh lows in every fall. Many blue chip stocks are trading 50 percent lower than their high levels. Many stocks are currently trading at their year's low prices or all-time low prices. Many investors have lost their hard-earned money and many others are stuck with stocks that have corrected heavily in the last few weeks.

Here are some tips for investors already invested in the stock markets:

1) Hold fundamentally strong options

The domestic macroeconomic fundamentals are strong. The GDP growth rate is expected to slow down slightly from the nine percent last year to around 7 - 7.5 percent this year. This is still quite good and encouraging in comparison to other developed countries. The current market crash can be attributed largely to foreign institutional investors' (FIIs) outflows but FIIs will come back once the global financial turmoil settles down. Therefore, investors who are invested in blue chip or fundamentally strong mid-caps should hold on to their positions.

2) Go for value picks

The current market fall is quite steep and many investors (especially small investors) did not have the time to exit from their positions. Market sentiments are quite bearish at the moment and a further fall from current levels cannot be ruled out. Market traders and analysts are expecting more negative news coming from the global as well as local macroeconomic front. Investors with a high risk appetite can look at accumulating fundamentally-strong stocks at current levels.

3) Switch sectors

Currently, the markets are looking oversold after the recent corrections. There could be some bounce back in the days to come. Investors stuck in fundamentally-weak stocks should look at switching their positions to fundamentally strong stocks and sectors.


Here are some tips for investors looking at making fresh investments in the stock markets:

  • Study stock and price

First of all, it is important to identify the stocks that have fundamental value at current prices. Investing in a stock at right price differentiates between a bad investment, good investment and a great investment.

  • Research stocks

The stock market requires constant study and investigation. Finding a good stock at the right price is not a onetime exercise. It is a continuous process. Active investors in stock markets should always monitor their invested stocks and other stocks with potential to invest in.

  • Systematic investing

Currently, the markets are going through a bearish phase. Investors should be extra careful while making investments in a bearish phase. It is advisable to accumulate stocks by investing your funds in small lots. In a bearish market phase, even fundamentally-good stocks correct heavily at times. Therefore, it is very important to have patience and not panic in these conditions.

  • Liquidity

Liquidity and having a cash position is the key to success in a bearish market phase. Investors should start investing in identified strong stocks and continue to accumulate them on further corrections.

  • Analyse risk appetite

Investors should only invest their risk capital in the stock markets. Also, investors should always have a long-term horizon while investing in the stock markets (more than one year at least). Investors should never borrow to invest in the markets.

  • Avoid penny stocks


Investors should stay away from investing in penny stocks. Usually, there is very little information available and also these stocks do not have enough liquidity in the market. As a result, investors get trapped in these penny stocks and lose their capital, and any further opportunity during a correction phase.

Popular posts from this blog

How to Decide your asset allocation with Mutual Funds?

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India) How to Decide your asset allocation ? The funds that base their equity allocation on market valuation have given stable returns in the past. Pick these if you are a buy-and-forget investor. Small investors are often victims of greed and fear. When markets are rising, greed makes the small investor increase his exposure to stocks. And when stocks crash to low levels, fear makes him redeem his investments. But there are a few funds that avoid this risk by continuously changing the asset mix of their portfolios. Their allocation to equity is not based on the fund manager's outlook for the market, but on its valuations. Our top pick is the Franklin Templeton Dynamic PE Ratio Fund, a fund of funds that divides its corpus between two schemes from the same fund house-the...

Mirae Asset Healthcare Fund

Best SIP Funds to Invest Online   Mirae Asset Global Investments (India) has launched Mirae Asset Healthcare Fund. The NFO of the fund will be open from June 11, 2018 to June 25, 2018. Mirae Asset Healthcare Fund is an open-ended equity scheme investing in healthcare and allied sectors. The scheme will invest in Indian equities and equity related securities of companies that are likely to benefit either directly or indirectly from healthcare and allied sectors. The investment strategy of this scheme aims to maintain a concentrated portfolio of 30-40 stocks. Healthcare is a broad secular theme that includes pharma, hospitals, diagnostics, insurance and other allied sectors. The fund will have the flexibility to invest across markets capitalization and style in selecting investment opportunities within this theme. Neelesh Surana and Vrijesh Kasera will manage this fund. In a press release, Swarup Mohanty, CEO, Mirae Asset Global Inves...

All about "Derivatives"

What are derivatives? Derivatives are financial instruments, which as the name suggests, derive their value from another asset — called the underlying. What are the typical underlying assets? Any asset, whose price is dynamic, probably has a derivative contract today. The most popular ones being stocks, indices, precious metals, commodities, agro products, currencies, etc. Why were they invented? In an increasingly dynamic world, prices of virtually all assets keep changing, thereby exposing participants to price risks. Hence, derivatives were invented to negate these price fluctuations. For example, a wheat farmer expects to sell his crop at the current price of Rs 10/kg and make profits of Rs 2/kg. But, by the time his crop is ready, the price of wheat may have gone down to Rs 5/kg, making him sell his crop at a loss of Rs 3/kg. In order to avoid this, he may enter into a forward contract, agreeing to sell wheat at Rs 10/ kg, right at the outset. So, even if the price of wheat falls ...

Equity Investing Strategy - Value to patient investors

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India) Beaten - down sectors = greater The markets are priced to optimum; steady earners are priced at premiums. But significant money is unlikely to be made through steady earners The equity market has topped 20,500 and is close to its alltime high, an enormous increase in value considering that just a few months ago naysayers were predicting a downslide. Three months ago, the Sensex was around 18,500 levels, and experts predicted the worst. Revenue and profit growth figures of the latest quarter have cheered the equity market. Revenue growth came in double digits while profit increased in line with analyst estimates. Now the equity market is factoring in a growth rate of approximately 14 per cent in the current fiscal – with consensus ...

Different types Joint Savings Bank Account

A joint savings account comes with operating options such as either or survivor, anyone or survivor, former or survivor and latter or survivor Are you looking to open a joint savings account with your spouse, parents, siblings or children? All banks that offer savings accounts, allow you to open a joint account. According to the Reserve Bank of India (RBI), there is no restriction on the number of account holders who can jointly share one account. However, there are banks that restrict the number of joint account holders to four. Further, the way you operate the joint savings account depends on the agreement that you have signed with the bank. Different types of joint accounts A joint savings account comes with operating options such as either or survivor, anyone or survivor, former or survivor and latter or survivor. These terms decide how you can operate the account and what happens to the money in case of death of an account holder. Either or survivor:   If you select this option, ...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now