[ontheroad]

I think it is not the right time to invest now. Markets are high due to FII buy and it will free fall when they sell. Also general election is coming up soon. So better clarity is needed before investing. I will start investing when nifty falls to 5800 only.

[S_U_N]

@ontheroad: For fundamentally strong companies, how does the election affect?

[ontheroad]

When market crashes, almost all stocks go down, though rate of crash will be less for fundamentally strong companies. Still if we get an opportunity to get into a good counter at lower levels, why should we miss?

[SmartCat]

If somebody is just starting off the process of investing in equities (like S_U_N), it doesn't make sense to wait for events like elections or short term corrections in the index - especially if they have a stable source of income (like salary or business income) and is not a retiree. The best way to go about it is to keep investing a part of monthly savings into equities regularly. If the markets go down, GREAT! You get to buy more at lower prices. If the markets go up, GREAT! Because, your portfolio has gone up in value.

But if you are still apprehensive about investing in stocks in these times, you can do the following -

1) Let's say you have Rs. 60,000 cash to invest.

2) Invest 20K in stocks, 20K in Fixed Deposits and 20K in Gold Mutual Funds.

3) Gold acts as a hedge against "bad news" that affects the stock market. What's bad news for stocks is usually good news for Gold. In the short run, one cancels out the negative effects of the other. And in the long run, both stocks and gold will go UP.

4) Let's say you save Rs. 20,000 every month.

5) Invest the savings equally between Stocks, Gold Mutual Funds & Fixed Deposits (Rs. 7000 each).

In these times, the above investment strategy should offer good returns with low risk.

[S_U_N]

Originally Posted by ontheroad

When market crashes, almost all stocks go down, though rate of crash will be less for fundamentally strong companies. Still if we get an opportunity to get into a good counter at lower levels, why should we miss?

@ontheroad: You seem to be speculating that the market will crash. It may or may not, unless you can predict or see the future. Don't get me wrong, but I find it hard to digest.

Originally Posted by smartcat

4) Let's say you save Rs. 20,000 very month.
5) Invest the savings equally between Stocks, Gold Mutual Funds & Fixed Deposits (Rs. 7000 each).

Yes. I should have mentioned that I have already money invested in fixed deposits and debt+equity MF's. Now, I am venturing into the stock market just out of curiosity.

How do you invest (Rs. 7000) each month in the stock market? Is there some automated way (like a SIP)?

Also, what about investing in the top stock package to lower risks? Is it Nifty midcap 50 or something else?
http://www.moneycontrol.com/terminal/?index=31

Originally Posted by S_U_N

@ontheroad: You seem to be speculating that the market will crash. It may or may not, unless you can predict or see the future. Don't get me wrong, but I find it hard to digest.

How do you invest (Rs. 7000) each month in the stock market? Is there some automated way (like a SIP)?
http://www.moneycontrol.com/terminal/?index=31

Yes, @ontheroad is definitely speculating. and this is how people invest in stock market. I hope no one invests without making any speculations. people see the % of good and bad and then invest only if % of good exceeds bad.

Yes, he is definitely correct (in my opinion.) that market will definitely come down a bit. some of my reasons being. Earnings of banks came down drastically, Rupee started showing off its weakness again, No good news for the next couple of months, power companies started bleeding again from new nerves, aviation.. dead. Small scale industries struggling hard. Power prices going UP, Inflation going up, onions?, Fuel prices going up, people's spending power comming down drastically, industrial output declining, Bad news from US (about to come), US Jobless rate is up again, and many others...
I see no industry is in good shape. Auto's marginally down, Power - down, aviation - dead, banking - very weak as NPA's are high. small scale - almost dead. Metals - very weak, Retail - ok ok but still weak and what not.

Sorry S_U_N, dont get me wrong, i really dont understand why you couldnt get it. There isnt any good news, Companies arent earning any thing much. Infact they are loosing money. And the market hit its all time high (Ofcourse its just a sensitivity index, but still...). How? Why? And, every new top has an equivalent new bottom. (Every action has an equal & opposite reaction.. from newtons law i think, and many investors believe in this)

Mods: Used "..." because, i felt its required over there. modify it, if you think otherwise.

[eq24]

I would suggest people to buy into the dollar defensives if investing for a short time frame. Most IT sector and pharma are good bets. The Dollar will appreciate more vis a vis the rupee due to various macro factors.

Also please do not buy companies which are nearly trading at all time highs.

For pharma I am currently invested in Sun Pharma, Aurobindo and Divs Laboratories. In IT I am holding Tech M and Mind tree.

[ontheroad]

Dear all, Let me clarify myself. Iam also a newbie in the market though i do some trade in small amount to test the waters. Why I said market will "correct" is that now it is nearly in the all time highs. It is just common sense that it will come down as 1) we as a country is facing some uncertainties(elections) in near future 2) markets are up only due to FII buying. Iam not saying that it will crash. Correction to 5800/5900 levels. I do agree on SIPs, but i think it is to be done with MFs and not individual stocks.

[SmartCat]

Originally Posted by S_U_N

Yes. I should have mentioned that I have already money invested in fixed deposits and debt+equity MF's. Now, I am venturing into the stock market just out of curiosity.

If you already own equity MFs but want to learn stock market investing, then check this link -

http://www.investopedia.com/universi...entalanalysis/

Start off my checking out each of the 50 Nifty stocks to see if you like any. Go to each company's website and read up on what it does. Go to the "financials" or "investors" section, download the annual report and read the first 20 or 30 pages (don't bother reading the balance sheet, it is not important).

Use www.edelweiss.in to check the financials of the company. Moneycontrol.com numbers are inaccurate.

[carboy]

Originally Posted by S_U_N

Also, what about investing in the top stock package to lower risks?

http://www.goldmansachs.com/gsam/in/...ees/index.html

Nifty 50 ETF - i.e. you can buy & sell it like stock. Expense ratio 0.5%. Low tracking error.
Holds all the Nifty Index stocks in the exact same ratio as the Index itself - i.e. it will rise and fall in the same proportion as the Nifty Index.

If you want to have Top 100, then buy the above + Nifty Junior

http://www.goldmansachs.com/gsam/in/...ees/index.html
I think expense ratio here is 1%.

Another decent Nifty index fund is
http://www.utimf.com/Funds/equity-fu...ndex-fund.aspx

I would buy the UTI one if you want to hold it for a year or two. And the Goldman Sachs one if you plan to hold it even longer than that.
The UTI one is not an ETF, but a regular mutual fund.

[S_U_N]

Originally Posted by gemi_kk

Sorry S_U_N, dont get me wrong, i really dont understand why you couldnt get it. There isnt any good news,

@gemi_kk: If things are so bad all over, then how come the markets are up? There is a negative sentiment in your post, but somehow the markets do not seem that way based on the numbers. Perhaps in near future the bubble will burst? But again, that is just speculation, isn't it?

Originally Posted by eq24

I would suggest people to buy into the dollar defensives if investing for a short time frame.

For that part, I have put money in two mutual funds:
Franklin Asian Equity Fund(G)
FT India Feeder - Franklin U.S. Opportunities Fund(G)

I have got 10% interest in just 3 months. No kidding!
But that is perhaps off-topic for this thread.

Originally Posted by smartcat

If you already own equity MFs but want to learn stock market investing, then check this link -

http://www.investopedia.com/universi...entalanalysis/

Start off my checking out each of the 50 Nifty stocks to see if you like any.

That was a good read- but then I realized, that others here would have already done the hard work of analysis. If I had time to read such a lot, then perhaps I would not post anything here, right?

Actually, your earlier list with HDFC, Lupin, etc was good enough for me to start with.

Originally Posted by carboy

http://www.goldmansachs.com/gsam/in/...ees/index.html

Somehow, Goldman Sachs site does not open for me. I will try this from home.

But is that a MF that you are talking about?

Nifty 50 ETF - i.e. you can buy & sell it like stock. Expense ratio 0.5%. Low tracking error.

Again, is this MF?

[carboy]

Originally Posted by S_U_N

But is that a MF that you are talking about?
Again, is this MF?

The Goldman Sachs (earlier Benchmark) Nifty, Nifty Junior and the UTI Nifty funds are all Mutual Funds. They are something called as non-managed MFs called as Index funds. A normal MF is actively managed - i.e some fund manager and his people pick stocks to buy or sell. An Index Fund is managed by a computer program which buys and sells the Index stocks in the same proportion as the Index. Because of lack of active management, the expense ratios is less.

Out of these, the Goldman Sachs ones are ETFs (Exchange Traded Mutual Funds) while the UTI is a regular Mutual Fund.
You asked about investing in the Top Stock Packages - Index funds do exactly this and a good index fund does it in a better way than you can.

Vanguard is the company which invented index funds. They are one of the top MF companies. They provide fantastic index funds in many parts of the world with expense ratios so low that won't believe it. Unfortunately they have no plans whatsoever of starting operations in India.

[rahulsharma2008]

Hey Guys! How come did I miss this thread for so long? Let me introduce myself as Head of Derivatives Research at the Best Broking House of India. Any derivatives related queries, I would be more than happy to help. (Equities/Currency any segment)

As I write this message, NSE has just annouced that tomorrow's holiday is shifted to Friday. So markets are trading tomorrow as usual. Happy & Sad !

[rahulsharma2008]

Originally Posted by S_U_N

My demat account is finally going to be activated today (or latest by tomorrow.)
I have no experience with stock market but can risk losing Rs. 50000 (which by the way I intend to stay invested with, for a few years.)
Can someone recommend some stocks for me?

I assume when I make some money, there is no income tax I need to pay for the gains. Please correct me if I am wrong.

I hope you havent bought any of the penny stocks which are available in plenty in the current market.

From the Nifty pack, only Metal and Reality stocks are the real underperformers of the last 5 years. Valuations wise metals stocks are looking the most attractive around these levels. Stocks like TATASTEEL, HINDALCO and JINDALSTEL are expected to perform well in the next 6-12 months.

From the non-frontline space, have a look at KAJARIA CERAMICS. HDFC Mutual Fund bought 20 Lakh shares of this stock yesterday. I have been bullish on this since 180 levels. Potential multibagger in the next 3-5 years.

I hope that helps.

[vindrider2626]

The problem with indian markets is the lack of retail participation.Even 1% of our people do not have any exposure to stocks or related investments.The people who have any sort of investments are all aged people whose risk appetite is low.The youngsters do not have any idea of stocks nor do they have any exposure into it. I wonder where the young people are putting their savings,if they are in fd, then the rate of interest is lesser than inflation,thus wiping out any capital appreciation.Real estate has gone up to absurd levels, from where it is virtually impossible to make any meaningful returns,so people have to park at least a part of their surplus into stocks.There are lot of stocks here, trading at absurd valuations which can reward people who go out and spot them, and buy for the future.Just imagine if even 10% of our population invest at least 50000 rs in the markets,it would be 6.5 lakh crores, much higher than what all the fiis have put here all these years.The stock broking firms should open offices in rural areas and educate people, as they do not have any idea of stock markets, and their operations.Now, apart from the metro cities and urban areas the firms have no offices.The real growth of our country would come from the rural areas, as the agriculture income is increasing and standard of living is going higher there.If we believe that india would become the largest economy in 2030, then our industries would have to fare, far better from the levels, in which they are now.New companies will have to emerge as leaders of the economy ,which will boost their profits,and thus their share prices will have to go far higher, from the current levels.