What should I do with my investments ? Many market participants have asked this question. Here is my view:
Investment in shares is part of your total investment planning. You may have a plan that goes like this:
50% of liquid funds to be invested in shares
(this should be reduced to 40% when the market is in a strong bull grip. It should increase to 60% when you perceive the market is in a bear grip)
Now, we assume that the current market scenario may well be called a strong bear grip. having a plan makes the decision process easy. If your current investments in shares are more than 60% of your liquid assets, then you have to bring it down to 60%. You need to sell on rallies. On the other hand, if your investment is less than 60%, then you can add whenever there is a panic decline.
This is about asset allocation. The percentages given here are only indicative. You should modify them to suit your own needs.
Now, many participants purchased shares for making a quick profit. they are stuck with these shares which have suddenly become a long term investment. Trading must always have stop losses. if you still own these shares then you did not follow the stop loss rules. If you are one of these traders, ask yourself: what do you do when you make a mistake ? You should seek the answer to this question. Each trader will get an answer that suits his/her mental attitudes.
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► 2011 (200)
- ► November (9)
► October (28)
- Answers to comments oct31-11
- Process of Consolidation Likely
- Nifty Pattern Targets Reached
- Happy Diwali
- Stock Selection (based upon their historical volat...
- M&M Consolidation
- Niftnear ORB Trade
- A dip in an ongoing up trend
- TATA Motors Life Cycle
- Hindalco touches support
- Mystery of the missing trailing stop
- Nifty Live Oct 12-11
- Point and Figure Charts
- Aiming for a better trade
- Long term view of Nifty
- Zen stories for Traders
- Hero Motor Corp at its support level
- NR 7 in Nifty Weekly Chart
- trading with a gap open
- Silver Pushes against Resistance
- An unusual continuation pattern in the Nifty
- Sudden Rally
- Nifty at 4750
- There is a time to be old and a time to be bold
- Afternoon review
- Nifty - Long Term View
- Higher High - Higher Low pattern in CNX IT
- Bear market shows its strength
► September (53)
- The Bear Story
- Nifty in a well defined range
- Morning View Sept 29
- Nifty Options Trade
- Nifty on way to close higher for this F&O settleme...
- Learning Ideas
- Short term trend is up
- Something Better
- A tale of two trades
- Before the Open - Sept 26-11
- Reliance - something better
- Nifty - A long term view
- Adding value to your analysis
- ► 2010 (263)
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▼ November (26)
- Weekend Reading, Nov 30.
- Rally, maybe
- This time it may be different
- Market will tell us when it is bottoming out
- Hard Work is the easiest way to success
- New Posts
- This Bear Market may last longer than we imagine
- Is there a rally ?
- Traders enjoy the process of trading
- Bear Market continues, Nifty, Sensex may go below ...
- Choppy Market with down bias
- What should Investors do now ?
- Nifty returns for a 'Test' of earlier lows
- The trend remains down
- A Matter of Trust
- Udayan in Amritsar
- Early Morning Review - Friday 14 Nov
- It is not about earnings downgrades
- Abrupt End to Uptrend
- Has the Bull Market Started ?
- The 2 PM Review
- So much volatility, Market resembles a Casino
- The Market Corrects its up trend
- Smart Rally, but careful as Nifty comes near resis...
- Quite times coming ?
- Surpirse Rate Cut may not add strength to markets
- ▼ November (26)