Some Stocks in My Portfolio are Up More Than 100%!! But…

Markets are rising. Now no credit to me for telling you that. Credit is only deserved by one person who has given us all a new hope to cling onto. 🙂

I am a perennial worshiper of stock market crashes…atleast for next 20 years.

But when everyone around me was talking about how stellar their portfolio returns were, I could not stop myself from having a look at my own portfolio. And when I did check, I saw shares of some very good businesses up more than 80% to 100% in last 3 to 6 months!

I want to believe that I am good at stock market investing.

But then I realized that markets are supreme and I am no good.

I repeat.

But then I realized that markets are supreme and I am no good.

And…

Rising Tide Stock Markets

Rising markets are loved by all. But it’s the pace of this rise that is frightening. Large caps are rising 10% to 15% every day and moving like big icebergs all over the place.

Not sure how long this would last. Lets see..

By the way, I hope you have pre-registered (free) for the launch of Ultra Long Term Stocks.

Pre-Registration closes on 25May-2014.

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More Than 400 Investors who have ALREADY Pre-Registered (Free) for Ultra Long Term Stocks.

Join them before 25th May 2014.


Pre-Registrations Have Closed.
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Huge returns given by Nifty 50 Stocks & how we got it right back then :-)

You must be wondering – Why 10 months? And not something more rounded-off like 1, 2 or 5 years? The reason is that in December 2011 (about 10 months back), we wrote about Nifty 50 stocks and prices which they were available at. At that time, we felt that some of these stocks were available at quite low prices when compared to their previous highs (2011 & 2008 highs). Our view was quite evident from the title of the post “Large Cap Nifty Stocks available at deep discounts.

Though you can read the post to better understand our view, in short we felt that some of these large caps were available at quite beaten down prices and it seemed more prudent to stick to businesses which could weather the economic storm rather than trying to find the next multibagger. We advised and started selectively buying (for our personal portfolios) some of these large cap stocks, which scored high on sustainability parameter and had revenue & profit visibility.

So after 10 months, with index up almost 22%, we decided to see where individual stocks have moved. The result is given in table below. Please note that we have compared only price movements and not the underlying value.

Note – Stocks removed or added to Nifty 50 do not feature in the table
  • A few of these names, which are a part of an average investor’s portfolio like Tata Motors, HUL , ITC, Maruti, HDFC & ICICI have given close to 50% return in last 10 months!!
  • But there have been others like Bharti, PNB & BHEL, which have given negative returns too.

So are we saying that we have special powers to predict market movements? Do we know how to time the markets? Absolutely not!! Nobody can predict market movements. Not even greats like Warren Buffett. But what we can do is to learn from history of stock market valuations. And history tells that markets near PE=14 are undervalued. But does it mean that it won’t go down lower? No. Markets can go further down to PEs of 10. What it does mean is that it is time to start accumulating stocks of good businesses.

With current PEs hovering above 19, we are not sure if it’s a good time to pick stocks which have already run up a lot in last 3 months. But in times of confusion (as we said that ‘we are not sure’), it is best to stick with regular systematic investment (SIPs) and wait for valuations to come lower.

Note – We have added a State of the Market tab where you can check latest market valuations parameters. Hope you find it useful.

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