Lessons learned

Current market turmoil as given lot of lesson to the investors new to the market.
People who were used to get returns just by investing blindly in the market past year have burnt their fingers recently.
Now people should stick to stocks which are fundamentally strong and should stay away from momentum stocks.
Fundamentally strong company can loose a little value in this kind of blood bath but they still retain their inherent value and will have premium in good markets.
We now have huge interest rate differential with US which is around 4.75%. We have to see its impact on capital inflow, dollar depreciation , industries affected, inflation because of inflows and RBI moves because of all these events.

Status quo by RBI recently has not been favorably received by most of the industry.

Indian stock market is at attractive levels now and should do well in coming years based on the growth estimates. Investors have to settle for lesser returns from past years but still it will be better than the traditional saving instruments.

The most important lesson which I have learnt is we always need to keep certain amount of cash aside. When market falls money not invested retains it value and gives you huge leverage when you can buy stocks when they are available at throw away prices.

If you are always 100% invested with all the money you have then when market falls you don't have dough/capital to use the opportunity knocking your door.

It can make huge difference if you buy in the depressed market condition.Though everyone is panicking , if you can hold your sentiments and invest wisely you can gain immensely.

1. Keep at least 15% of liquid cash to cash in on the market opportunities.
2. Buy and increase your holding in value stocks.
3. Always book profit in momentum stocks when market peaks and show sign of weakness.
4. Don't play on margins when market is in turmoil.
5. Don't over leverage.
6. Play only on cash. Don't risk more than you can afford.
7. Buy tax saving instruments when markets are on high and you don't have any alternative. Don't wait for January or February.
8. Buy equity when markets are at there lows.
9. Don't gamble play informed.
10. Don't panic and never loose. Don't convert winning stock into a loosing one.