THE VERY FUNDAMENTAL ASSUMPTION OF STOCK INVESTMENTS (for that matter any investments) ARE TO MAKE MONEY WITH SUITABLE PORTFOLIO OVER A PERIOD OF TIME. MANY RETAIL INVESTORS QUITE OFTEN FAILED TO RECOGNIZE THE BASIC RISKS INVOLVED AND ALSO IGNORE THE FUNDAMENTAL RULES TO BE STRICTLY FOLLOWED TO MAKE MORE MONEY FROM THE STOCK MARKETS.
Ace Investor Ideology:
Every Investor bestowed with equal opportunities to make lots of money from stock market investments provided think & invest like an institutional investor does. No matter how big or small money available for investments, doesn't matter whether BUY a small-cap, mid-cap or Large-cap but the approach to investments in markets makes a person rich or multi-millionaire.
Most of the stock market retail investors follow their legendary investors stock investments. It is not wrong to follow a successful investor's ideology but what matters most is the suitability to one's needs and requirements. So always understand the concepts of an Ace Investor strategy & sector allocation then develop a workable strategy that suits well but don't just follow blindly.
Who Rules...?
The Stock price action gets activated from Low to High and High to Low due to a determined tussle between BULLs & Bears that enables smooth transfer/exchange of VOLUME to acquire/offload the stock. During good times BULLs command the most, while BEARs take charge when gloominess runs but the underlying attraction point that turn tables is neither Bulls nor Bears but the PRICE. The STOCK PRICE attracts the interested parties to become BULLS or BEARS to command and enjoy the future returns. The possibility and future prospects propel the participants to decide their position and sustain their view till the PRICE reaches its realistic value.
Trade the Price:
Stock trading/investments open the doors of opportunities to many players like Day-traders, Swing traders, Positional traders, retail/small investors & Institutional investors..etc with a bouquet of investment opportunities in different companies in various sectors. The growth stocks always build their strong base during the times of bad periods/recession time and emerge as winners and find pinnacle place as tide turns their favour with a tag as most sought/favoured stocks. It is always advisable to "Trade the Price" to make more money from markets even in multi-bagger stocks once the valuations reach very high. In case the overall market take a Southward journey, these counters also deserve a trade but don't exit from the stock. This situational position sizing and building the portfolio is very important to enjoy long-term multifold returns. (Ex: Recently Rakesh Jhunjhunwala sold Delta Corp at Rs 160+ levels range and re-entered @ Rs105+)
Build Capacity to Hold:
The capacity to hold with large quantities for a reasonable period makes a big difference in enjoying the multi-bagger stocks upward journey. Many seasoned investors know that the Elliot principle plays a big role and most retail investors get out of the stock during the first leg of the up move or in the retracement levels.
Many successful investors who learned hard lessons from their experiences shared the importance of Position sizing. Their initial investment experiences are bitter to digest and some blew their accounts with an anticipation to make HUGE profits in short period, turned sour. The psychological exuberance while buying blue-chips and excitement to hold large quantities of quality stocks for multi-bagger returns encouraged them to ignore current high valuations. All the more, got trapped in LEVERAGE loop, find it hard to hold for a longer period during the downfall forced them to exit for a loss or nominal profits from that possible multibagger counters. These experiential situations are common to many investors.
MULTI-BAGGER INVESTMENT STRATEGY:
NO-DOUBT, STOCK-MARKETS ARE ONE OF THE BEST AVAILABLE AVENUES FOR INVESTMENTS TO SMALL INVESTORS TO LARGE INSTITUTIONAL PLAYERS. THE STOCK-MARKET INVESTMENTS MADE IN MULTI-BAGGER COMPANIES, MANY A TIMES REWARD INVESTORS WITH MANY FOLD RETURNS TO THOSE WHO “SPOT THE RIGHT OPPORTUNITY AT THE RIGHT PRICE” AND POSITION THEIR INVESTMENTS ACCORDINGLY.
- The multi-bagger companies carry a unique business model with high-end products&services and less competition "Buyer Requests & Seller Demands" mode.
Ex: 8K Miles (Rs 18 Low in 2012,Rs 2550 High in 2016)
- Once, well-established companies ran into doldrums with underutilized capacities, later get a new drive, turn-around story with better economic prospects to garner the unfolding opportunities.
Ex: INDO COUNT INDUSTRIES (Rs 5.0+ Low in 2012,Rs 1248+High in 2016)
- Management rejuvenate their entire team with positive energies to increase revenue and profitability with 20-35% QoQ growth.
- The stock hardly falls from the consolidated floor price range gained in its upward journey
Conclusion: There are many good stocks available in Indian stock markets to become multi-baggers in next 3-5 Yrs. It is very important to identify good stocks to BUY and Hold, but at right price is even more important.
