It has been almost two years that I have started taking sincere interest (or at least what I think) in stock market. I try to read/listen everything about stock market and investing. However, I have learnt one thing that all these reading has not made me or will not make an investor with capital I, in few months. I have realized that like almost everything in life , investment in stock market is no different. One needs to remain patient during high low tides, I will need at least a decade of experience to excel at it.
I was lucky enough to enter during August’06 just before the market started peaking out. Thereafter the market had seen dream run (and nightmare thereafter). It was amazing to buy Reliance Natural (RNRL) between Rs. 17-00 when there was no movement. Tata Tele (TTML) was also lying low around Rs.17-00. Reliance Petro (RPL) was available at the IPO price at around 60-65. Grand daddy of all, Reliance Industry was somewhere around 1100-1200.
But then again, entering timely in the stock market is perhaps a hard thing, but exiting from the stock market is definately the hardest part. My many investments soared anywhere from 5 to 10 times (RNRL went from 20 to 230, RPL from 60 to nearly 290) but I failed to encash largely.
It is not that I had not sold and earned profit , but what happened that almost all my profit has been re-invested in equity. I did not diversify my investment (investing in mutual funds is not diversification, now I know).
Now, almost all of scrips I have got in my portfolio is either at the same level of my purchase price or below except RNRL and RPL, and I am afraid, perhaps they will also see their original purhcase prices.
Again, not many of scrips in my portfolio are cheap stocks. Most of companies are from A group, and others I have bought from at the recommendations of Equitymaster.
All I have to do is now to wait patiently for some time, 2-3 years is my guess. Meanwhile I will accumulate selected blue chips which offer good valuation in long term.