Adopt a long-term perspective.

Adopt a long-term perspective.

Large short-term profits can often entice those who are new to the market. But adopting a long-term horizon and dismissing the “get in, get out and make a killing” mentality is a must for any investor. This doesn’t mean that it’s impossible to make money by actively trading in the short term. But, as we already mentioned, investing and trading are very different ways of making gains from the market. Trading involves very different risks that buy-and-hold investors don’t experience. As such, active trading requires certain specialized skills. Neither investing style is necessarily better than the other – both have their pros and cons. But active trading can be wrong for someone without the appropriate time, financial resources, education and desire. (For further reading, see Defining Active...
Domestic invester turning to stocks with low FII holding

Domestic invester turning to stocks with low FII holding

Domestic investors, especially high networth investors, are focusing less on stocks that are the choice picks of foreign investors (FIIs). This is because continued FII selling has led to a large supply of these stocks, driving down prices. These domestic investors are instead, turning to stocks with low FII holdings that have seen prices rise. Their shift is supported by data. During the past month, over 70% of the NSE500 stocks with FII holdings of less than 10% have outperformed the broader market. In contrast, 59% of the stocks with more than 10% FII holding have underperformed the market.  Experts, however, advise investors to take abundant caution while selecting stocks with lesser FII holding.  Among the NSE500 stocks, the top gainers over the past month like Godfrey Phillips, Parsvnath Developers, Lanco InfratechBSE -0.33 %, Titagarh Wagons, Firstsource Solutions, Engineers India, KSK Energy, MRPL, GMR, Mahindra Holidays, Gati, TV18 Broadcast and TV Today Network have less than 10% FII holding. These stocks have risen in the range of 10% and 50% as against 4% fall in Nifty.  “Of late, action has been shifted to mid- and small-cap stocks with low FII holding and hence many of them have risen sharply despite weak market sentiment,” said Raamdeo Agrawal, joint MD, Motilal Oswal Financial Services.  “HNIs and to some extent domestic funds, are avoiding FII-dense stocks due to heavy supply in the market”.  Stocks with more than 10% FII holding like Dishman Pharma, Advanta, PTC India, Eros, Kolte Patil, Tribhovandas Bhimji, United Spirits, Kaveri Seeds, Dr Reddy’s Lab, UPL and Rallies India have declined between 15% and 25% in the past one month. ...
IIP growth a morale booster for economy

IIP growth a morale booster for economy

Cheering the spurt in industrial output which grew by 9.8 percent in October, India Inc termed it as a booster for the economy, hoping that the strong growth trend would continue on the back of reforms. “The industrial growth on the back of an impressive double digit expansion in manufacturing should no doubt be considered a morale booster for the economy,” Assocham President Sunil Kanoria said. “We look forward to strong industrial growth recovery, with the sector registering double digit growth in the coming times,” PHD Chamber Secretary General Saurabh Sanyal said.  In a big jump, the October industrial production grew 9.8 percent on an annual basis, riding on the back of a robust growth in consumer products and capital goods during the festive season. IIP growth for September has been revised upwards to 3.84 percent while it was -2.7 percent in October 2014. The manufacturing sector, a key indicator of economic activity, grew 10.6 percent year-on-year in October. Electricity generation expanded 9 percent and the mining sector was up 4.7 percent. “Though manufacturing registered a high growth in October, the low base in major sectors like capital goods and consumer durables has contributed significantly to this high growth. “Nonetheless, the outlook for growth remains positive and can be strengthened in coming months if pace of reforms continues,” Ficci Secretary General A Didar Singh said. However, Singh pointed out that the global slowdown continues to impact trade and affect India’s exports adversely thus impacting manufacturing growth especially when the domestic demand is also sluggish. Hailing the October industrial production growth, engineering exporters’ body EEPC India said a similar feat...