Investment Tips

Few months back I started looking at stocks which would grow with Indian consumption and growth story.

I personally don't like stock which are cyclic in nature. You have to continuously keep track of their movement. Examples would be Sugar, Oil marketing companies and ferrous and non ferrous stocks to name few.

But I must point that these stocks give huge return in small time and then they fall the similar way when the cycle turns around.

So basically to build a long term portfolio in which you keep buying and stay invested without looking back and these stocks keep growing like your baby or well watered tree. [ Leave apart the short term blips which are beyond anyones control.]

Depending on your age and time you can invest [Note I am not talking about money but time]
you can have a perfect mix in your portfolio.

Portfolio = Long term + medium term + short term stocks+ risky multi baggers
Long term stocks : These are the stocks you don't sell atleast for few years [5-10 years]. Take my words returns are mind boggling. I would tell u the importance of holding in a separate post.
Examples would be : L&T, Reliance , ICICI to name a few.

Medium term stocks :- You keep them for 1-2 years and then you know that they won't give you the kind of return they have give in the past and have stabilized. So you shed them and move on.
Examples here would be ITC, HLL [These stocks gave amazing returns when they were in expansion and growth phase. They made consumer goods available to huge population[in villages] of this country by innovative products like sachet and their topline and bottom line grew]. Now if you look at ITC it was at 180 when stock market was 800 and still at that level when stock market is 20000.

Stort term stocks :- Sugar stocks , Oil marketing companies etc....
Look at HPCL this stock moves between 200-300 range atleast 6-8 times in a year. Its movement is dependent upon government oil bonds, crude price etc...

If crude rises this stock moves down.....and viceversa...

Goverment is not rising the price of petroleum..stocks goes down and vice versa...

Government bails out by issuing oil bonds ....stock goes up...

Sugar....when sugar supply is less price rises hence the stock....farmers grow more looking at high prises and next year we have glut and price falls and hence the stock.

You can buy these stocks and sell after some months when you have got handsome returns. If you keep longer you will be back to square one.......

Multibagger :- These are currently penny stocks with good management to give huge returns.
You can invest in small amount in these . Lets say 2-3 thousand in 10 of these stocks.

Even if 6-7 fails and 3-4 really turns out to be multibagger you willbe looking at good profits.

Happy investing...