How To Make Profit From Market Corrections

How To Make Profit From Market CorrectionsThe term “market correction” can instill fear into some stock market investors. For others, a correction means fresh share buying opportunities.

Correction is a realistic scenario for stock market participants. After every bull run, a correction has to happen. It’ is often discussed, debated & analysed and forgotten when the trend turns positive.

First and foremost, corrections doesnot indicate any market direction ie they  just dont happen on the downside. There are upside market corrections and downside corrections as well. So if we define a correction, it is a correction of the trend. And a trend can be up and down.

How to make profit from the correction is the main discussion to discuss. Normally when a correction happen, if Nifty falls by 10%, mid caps counters & by some means even the large cap counters are available at 20% discount. A investor must treat it as a “END OF SEASON SALE”

But the point is, he must identify the counters which are

  • fundamentally sound
  • Showing constant EPS Growth of over 20%
  • Bright Future Prospects

Take a example. Looking at the current scenario, one should look to accumulate picks like IDFC available at 35% discount, Lupin available at 20% discount. One poor investor would always go in for buying stocks like Unitech, DLF, DB Realty just because they are available at 70% discount. That is where the retail investors get caught. They want to earn too much in small period of time. Suppose, they want to buy Unitech @ Rs 35 & expect to double its value in months.

Without considering the fundamentals of real estate sector where they are not getting loans from banks, one should always learn to invest in good stocks that may be available at less discount as compared to other stocks

Thanks ;
Mr. Mayank Gupta, MBA Finance,  CRISIL
Wealthbazaar.in
9967052367

Be Sociable, Share!
Tags: , ,

Stock Market Basics For Beginners

The emerging countries(markets)

The emerging countries(markets) The emerging markets (nations) have seen fundamental and structural modifications in their economies and financial markets in the research time period, approximately 1993-2005. Table one ...…

Post Office Monthly Revenue Plan

Post Office Monthly Revenue Plan Post Office Monthly Revenue Plan is known as a low risk saving tool, Post Office scheme can be availed by any post office. It offers ...…

How can 5000 SIP can make you a Crorepati

How can 5000 SIP can make you a Crorepati Dear Readers, If I take a survey of 100 people today. 100 out of 100 would have a dream of  becoming a Crorepati. Yes, you can ...…

Mean For Preferential Issue

Mean For Preferential Issue A Preferential issue is an issue of stocks or of convertible securities through listed firms to a select number of person's under Section 81 of ...…

Definition For Lock In Profits

Definition For Lock In Profits Realizing the profits of a position, like buying a share, through exiting at a gain. By locking in, that part of the investment is not ...…

Indian Share Tips

NSE Investment Site

Market Update

Share Guide

Designed by VMV
web
analytics