If India VIX is a good enough indicator of fear among market participants, then the week gone by had enough good news for us as the fear gauge index slipped almost 10 per cent in just five trading sessions. Investors, however, stayed away from metals and banks to hide in the safety net of FMCG and pharma stocks.
In this edition of Tweet Buster, we have compiled the best of gyaan from FinTweet to help you navigate an uncertain market, investment ideas and the do’s and don’ts of investing.
Value investor Abhishek Basumallick says for people who are starting off their investment journeys, a couple of SIPs in Nifty and Nifty Next 50 index funds or ETFs is a great place to get started. “Helps with diversification also in building a strong base portfolio,” he says.
For people who are starting off their investment journeys, a couple of SIPs in Nifty and Nifty Next 50 index funds… https://t.co/PTmhIicBIc
— Abhishek Basumallick (@a_basumallick) 1625200200000
The don’ts of investing in debt
Edelweiss Mutual Fund CEO Radhika Gupta has an advice for debt investors in a low interest rate market. “Do not stretch the boundaries of either duration or credit to earn higher yield, especially on short term parking money where risk on capital can’t be taken,” she says.
Important debt advice in a low interest rate market: Do not stretch the boundaries of either duration or credit… https://t.co/WYvSOjE0dM
— Radhika Gupta (@iRadhikaGupta) 1625032782000
How to beat the Street
Outsized money is rarely made by buying what everyone else is at a price higher than them. “Ask yourself, what gives me a right to earn outsized returns? Am I buying something different? Am I buying it cheaper? Am I holding on longer?,” says Gupta.
Outsized money is rarely made by buying what everyone else is at a price higher than them.Ask yourself, what give… https://t.co/gbzWJbx0GD
— Radhika Gupta (@iRadhikaGupta) 1625024986000
Two risk myths
Gupta warns against two myths:
1) Index funds are not risky (they only eliminate FM risk, not inherent market risk, which is large)
2) Gilt funds have no risk (they eliminate credit risk, but have duration risk which is meaningful)
Two risk myths roaming around…1. Index funds are not risky (they only eliminate FM risk, not inherent market ris… https://t.co/NYMDsQfG6E
— Radhika Gupta (@iRadhikaGupta) 1624897916000
Lure of easy money
At a time when the benchmark equity indices are hovering near all-time high levels, maverick value investor
Vijay Kedia says the desire to become a millionaire overnight is the root cause of failures in the stock market.
The desire to become a millionaire overnight is the root cause of failures in the stock market. 😇 https://t.co/F2PaSs7sJ0
— Vijay Kedia (@VijayKedia1) 1625323438000
Sanjiv Bhasin of IIFL Securities has a target of Rs 1,350-1,400 on Cipla by the end of 2022. “Big positive for Cipla as it gets approval to import Moderna vaccine with commercial interest talks underway,” he tweeted.
Big positive for Cipla as it gets approval to import Moderna vaccine with commercial interest talks under… https://t.co/TcpjsCPPR9
— sanjiv (@sanjiv_bhasin) 1624974427000
PMS fund manager Shankar Sharma described the commonly used valuation metric P/E (Price-to-earnings) ratio as a largely oversimplified metric which is mostly useless. “It is impossible to PE across sectors, countries and periods. Interest rates completely influence PEs and anybody who says otherwise, needs some basic education in valuation,” he says.
My view on the PE Ratio:Notes: 1. Lazy oversimplified Ratio. Largely useless.2..Impossible to use PE across secto… https://t.co/nV5iUcIca6
— Shankar Sharma (@1shankarsharma) 1624962633000
Don’t Google it
DSP Mutual Fund’s Kalpen Parekh says the best way to search for a mutual fund is not by doing a Google search for the “best performing mutual fund” because best performers change every year.
Not the best way to search for a fund to invest. Because Best performers change every year 2015 : mid caps 201… https://t.co/L4SGDeZMBr
— Kalpen Parekh (@KalpenParekh) 1625079738000
Investing gems from Ian Cassel
I recently bought a stock 4x higher than my initial purchase. The company has done everything they said they would.… https://t.co/GaIG8A5TGO
— Ian Cassel (@iancassel) 1625315312000
Let management decide your holding period. The longer they execute the longer you hold.
— Ian Cassel (@iancassel) 1625181202000
I’ve always valued meeting management because 55% of communication is transmitted by body language, 38% voice tone… https://t.co/S2jahGNDXy
— Ian Cassel (@iancassel) 1625173978000
The hardest part of microcap investing is finding businesses that deserve to be held for the long-term. Normally I… https://t.co/zRY46hh3nT
— Ian Cassel (@iancassel) 1624970607000
Many of us already own the stocks we need to outperform. We just can’t get scared out of them.
— Ian Cassel (@iancassel) 1624719706000