Uncertainty and Fear rules the stock markets and sets the future trends....

last week i had written an article....Something different had happened in the markets these time around...Nifty was at lifetime top levels and Midcaps and Smallcaps were correcting as if there is no tommorrow...Both the Caps were down by 40% to 50%...and some chor and kacharaa stocks are still correcting till date at the time of writing these article...



I have a strong gut and intuitive feeling.... something is not right in the market....the smart investors are fooling us is what I feel.... because NIfTY is at top level but most of the A group companies are CorrEcTinG as if it a blood bath out there....while Midcaps and Smallcaps have been butchered completely....

Be careful of SUCKERS RALLY.....many StoCKs in Midcaps and Smallcaps in one day only are going up by 5% to 7%....but they all fizzle out from next day onwards....so be careful and buy StoCKs which are down in price but are fundamentally very strong and not overvalued.... and not highly leveraged and have very good management ....

Are we going through a Suckers rally....to some extent yes....but it is always hard to identify trends in stock market..... and even if you are proved right it is probably your luck or a fluke....but in current scenario something is not right...nifty is at lifetime high and the public Euphoria is missing...I mean there is no active participation by the retail investors.... but these is the way market operates...the conviction is missing in market participants and it is a perfect time for market to go up.... when there is fear only then the market will go up....but then it is a case of   psychology .....  in current scenario the Midcaps and Smallcaps are going through their worst case bear trend.....and nifty is making lifetime high...so in many ways the current trend is different.... and will it be a new norm which we have never come across till date.... therefore rather than firing in the dark.... wait for some more time for clarity to come in the market....but always remember in short term basis in stock market you will most of the time will always be proved wrong by the market... what I mean is the moment you enter such a market the probability of you making a loss are very high.... and making a profit will be a chance of luck only....

Fools will exist in stock market as long as market last..... and people like Rakesh jhunjhunwala.... Vijay kedia.... Ramdeo Agrawal.... have got an opportunity to earn a huge amount of wealth because of these fools who happily come to part their hard earned money to them....these so called fools will always come happily in stock market but one thing is gauranteed for them in stock market.... when the majority of them will leave.... there will only be sorrow for them for sure.... because they have to lose in stock market until unless they are well educated in managing their money and do proper research and analysis of assests they want to invest in....


as i have written in the fourth paragraph that because of Psychological reasons of uncertainty and fear the markets are bound to go up....and the current fear in midcaps and smallcaps will overrule everything in the stock markets and are total attention will be drawn towards these both caps...like fools we have been made the Biat of so called smart investors...there was clear writing on the wall that the nifty will go up and make new lifetime highs but no one knew which companies will contribute to the nifty making new lifetime highs...so as long as the uncertainty and fear is existing in the current market.... nifty will keep on making new and new lifetime highs and the poor retaIL investors will be left out high and dry...

so as per the above explanation the Day the earnings and the gdp growth of economy expectations of the people are achieved we are going down for sure as per the Psychological reasons...the fulfilling of Anticipation and Expectation will get us only disappointment in stock market once they are achieved...therefore as long as the expectations of earnings....the expected growth of the economy are not achieved and still there is total uncertainty and doubts... the stock markets will keep on going up and up and up...lastly MONEY IS STILL VERY EXPENSIVE TO GET....the day money becomes cheap and easily available the economy will collapse eventually and so will the stock markets of the world...TODAY IN THE CURRENT SCENARIO MONEY IS NOT READILY  AND EASILY AVAILABLE AND IS THE PRICIEST COMMODITY AVAILABLE TODAY...SO EVERYTHING WILL GO UP...THE STOCK MARKET AND SO WILL THE ECONOMY FROM HERE....

bUT WHICH SECTORS TO INVEST AND IN WHICH COMPANIES IS TOTALLY UP TO THE INVESTOR...

Above is not a recommendation and is my personal opinions and views only...

PE and Earnings....

The difference, however, is that emerging-market companies are far cheaper. The EM index’s price-to-earnings ratio is 13.3 based on 12-month trailing earnings per share, compared with 21.1 for the S&P 500. That difference is even more stark when looking beyond one year. The EM index’s P/E ratio is 14.7 based on 10-year trailing average EPS, compared with 29.5 for the S&P 500.

To see why that’s important, consider the long history of P/E ratios in the U.S. The average P/E ratio for U.S. stocks based on 10-year trailing average earnings has been 18.6 since 1881, with a standard deviation of 7.3. Those numbers imply that roughly 95 percent of the time, the P/E ratio will land somewhere between 4 and 33. (For stats aficionados: Those P/E ratios aren’t normally distributed, but they’re not far off, with skewness of 1.3 and kurtosis of 2.4.)

It makes intuitive sense that P/E ratios should fall within that range nearly all the time. A P/E ratio of 33 translates into an earnings yield of 3 percent. Many investors would balk at such a low yield and turn to bonds, which would curb further valuation growth. On the other side, a P/E ratio of 4 implies an earnings yield of 25 percent. There aren’t many investors who would pass that up, which would keep valuations from sinking further.

The data for emerging markets is limited, but so far it has closely hugged the range implied by historical P/E ratios in the U.S. Since December 2004, the EM index’s P/E ratio has hit a high of 36.5 in October 2007 and a low of 10.1 in February 2016. Comparable numbers for the S&P 500 during the same period were 30.4 in January of this year and 11.9 in February 2009.

All of that translates into different potential payoffs for U.S. and emerging-market stocks. The price of the EM index would have to decline 73 percent to reach a P/E of 4, compared with a decline of 86 percent for the S&P 500. On the other hand, the EM index would have to increase 125 percent to reach a P/E of 33, compared with just a 12 percent gain for the S&P 500.  

Concept of Holding period for ever is not right....

the concept of holding stocks forever is actually wrong and does suffice....there are few reasons which i will jot down for the readers.....
when Stock prices are high and so is valuation then it is the right time to sell even if the company is the best company of the world....if you own a jewellery set which is the best and you have paid say Rs. 10,00,000/- for the set....and if you want to sell because people want to buy it....will people offer you the price of Rs. 50,00,000/-even  if they want to desperately own it....no ways...for everything there is a price...but not foolish prices....so at high valuations to own the best company of the world is a foolish idea and immediately it has to be sold....
when the management deviates from its course and become overconfident and over adventurous and start buying companies double their nettworth...
also when the company management starts cheating the minority shareholders...
when the company starts accumulating too much debt....
transfers money to its other subsidiaries...
siphoned off money from the company...
when the fundamentals of the company takes a beating...

Midcaps And Smallcaps....the boom boom not over...lol...

Before i start my explanation let me remind you of Boiling Frog Syndrome and our resistance to small changes....before we even realize and come to our senses our portfolio was already bleeding... and it was too late  and we are now sitting on huge losses and by default we become a long term investors for which we had not planned at all...our motto was to make quick money and also get out qucikly...but fate had something different stored for us...LOSS...LOSS...

Yes as per my perspective they are in a Bear Market and the correction in both the caps will still last for some more months... i am damn convienced that the correction will be of atleast 40% to 50% in stocks of both the caps...the few stocks i am following in both the caps...the technical charts of most of them are very bearish and showing a clear signs of a bear market in them...whatever these so called experts say but we are going down for sure...it is for the first time i have seen that the markets are at elevated levels because of few heavy weight stocks which is helping the nifty to sustain those elevated levels but the midcaps and smallcaps are giving way and falling to new 52 weeks low and there are no signs of recovery...i sense that the market is waiting for these so called new investors who entered from November 2017 and who created the froth and the subsequent bubble in the midcaps and smallcaps...until unless they dont sell in panic the bottom will not be formed and these both caps will keep on going down.... Right now they are still in DENIAL mode that such a correction what is happening currently is not true and both the caps will recover very fast...so be wise and invest wise....happy investing for the long term....the above is my personal opinion only....it is not a recommendation to buy and sell...please take your certified financial advisor advice....

PC Jewellers and Vakraange....Scams

Dubious companies modus operandi.....
PC Jewellers
Vakrangee

In 2014....

PCJ was @45...
Vakrangee @45...

In January 2018 both made life time high...

PCJ @600
Vakrangee @516....

Today both are making life time lows....
PCJ @65....
Vakrangee @31...

Now you are a better judge.... and above all if I am not mistaken.... why PC Jewellers was a investor in Vakrangee....
 Both StoCK have same similarity of price movements
Fools will exist in stock market as long as market last..... and people like Rakesh jhunjhunwala.... Vijay kedia.... Ramdeo Agrawal.... have got an opportunity to earn a huge amount of wealth because of these fools who happily come to part their hard earned money to them....these so called fools will always come happily in stock market but one thing is gauranteed for them in stock market.... when the majority of them will leave.... there will only be sorrow for them for sure.... because they have to lose in stock market until unless they are well educated in managing their money and do proper research and analysis of assests they want to invest in....

TV Business channels were biggest enemies of I.T.sectors....and see what happened...

Had written on TCS and Infosys.....

it had to go up because no one was interested in owning TCS and Infosys....

The whole world was running after Midcaps and Smallcaps and poor investors had to part with their hard earned money...

TV channels were popularising Midcaps and Smallcaps..... Eventually they went down.....

TV channels were disregarding TCS and Infosys..... they went up...and both are touching new lifetime highs....

Always do the opposite of TV business channels....

Bear Market for Midcaps and Smallcaps....

Nifty is going up because of very few heavyweight StoCKs like....
Reliance
TCS
Infosys
HDFC Bank
HUL

If the above StoCks contribution is omitted.....then NIfTY is going nowhere....

Also the Midcaps and Smallcaps are correcting everyday on the downside... and individual StoCks are making new lows....
I have a very strong feeling that in Midcaps and Smallcaps we are experiencing a bear market.... because many companies in both these Caps have gone down by 30% to 50%....also the excessive froth which was built up just few months back is the reason we are CorrEcTinG so much....but after the mayhem in Midcaps and Smallcaps is over and investors who have survived these brutal blood bath will be rewarded with unimaginable profits in the next few years....but the coming few months investors who have invested their hard earned money in Midcaps and Smallcaps and especially the Chor kacchara companies will see their money getting transferred automatically to Ramdeo Agrawal....Ramesh Damani....Rakesh jhunjhunwala.... Vijay kedia.....So be wise and stay wise as long as you are active in Stock market.....
Very soon in Midcaps and Smallcaps we are going to experience a SUCKERS RALLY on the upside... and I think it will be a TRAP for retail investors.....

All the articles I send are my personal opinion and views only..... they are not a recommendation for buying or selling....

Pharma stock Prices are still overvalued......

Pharma StoCks valuation are still very high and so they have to correct to more realistic prices or will have to correct time wise so the valuation can catch....and makes more sense price wise and valuation wise.... like in Sun Pharma....the fy 18//19 EPS is projected around @16:50 and fy 19/20 EPS is projected to be around @19.... considering the additional income from Halol plant.... even in fy19/20 if the StoCK is given a multiple of PE20.... The sun pharma stock should hover somewhere around 380....400....
And note nothing extraordinary is going to happen in Pharma sector in coming 3 years atleast... and the way these business tv channels are talking about Pharma sector makes things confirm that one more fall price wise is left or the price will be range bound for the next 2/3 years atleast till the time the business tv channel people stop talking about Pharma sector totally leaving few genuine fund managers like S Naren ICICI AMC...to talk about the Pharma sector....still the retail investors are not tired of investing in Pharma StoCks....the day these last lot of investors are massacred the bottom will not be in place.....

Earnings Valuation....

When the Diff in  Value in the first field is (-21.80)..... the stock low price is 38/-....it means the value of the stock is below its intrinsic value and has a good safety of margin of 21.80% and so stock price is at its lowest price of 38/-.....

But in the second last field the Diff in Value is (+77.88)....the stock price is 1250....it means that the Value of the stock is 77.80% above its intrinsic value and has worst margin of safety and above all these the price of the stock is very high....@1250....

Now how can these be possible.... when the stock provides a very good margin of safety still the stock is at its lowest price.... and when the stock provides worst margin of safety...it is at its highest price... what kind of anamoly is these.... and we human beings are so insane and irrational....yes we are and that is how the stock market runs....

Also if you see in the last field the market realized that the value of the company is way above its long term averages and it's has to regress to the intrinsic value.... and as can be seen  the Diff in Value (12.2) has regressed towards its Long term intrinsic value.... and the beauty is along with it the price of the stock from a high of 1250....has also gone down to @610....