Hat Tip: J Dewan
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Linkfest: September 16,2016
Some stuff I am reading today morning:
Two mega trends for next 10 years (Ravi Dharamshi)
Why Bollywood’s investment model is not working (Mint)
NMDC,MOIL’s buyback offers open on Sept 19 (BL)
An investor’s guide to the insurance sector (Quint)
If you are buying, who’s selling? (Irrelevant Investor)
My 5 Worst Financial Mistakes (RetireBy40)
Martingales and Markets (Pension Partners)
Investing Cage Fight:Real Estate Vs Blogging (Financial Samurai)
Wall Street’s insatiable lust for data (Climateer)
Oh…the investment mistakes I made (Backland)
China IIP 6.2 %
India IIP -2.4 %
India Indirect Tax collection + 27.5 %
India Direct Tax Collection + 15 %
How to reconcile this paradox ?— Nilesh Shah (@NileshShah68) September 13, 2016
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Naren on Buying Cyclicals
Many of the commodity-based sectors see cyclical trends as can be seen in metals, oil, shipping, sugar, commercial vehicles, capital goods etc.
The point to remember while investing in these pockets is that there will be times when these companies will do very badly, which should be the ideal time to buy, and there will be times when these companies do very well, which are times to sell.
The key understanding here is the best time to buy a cyclical stock is when their share price is low and not when their earnings are high.
For example, when sugar prices are at their bottom, sugar stocks will be at the bottom, but their valuation in terms of price to earnings, will be very costly.
So it is important to buy cyclicals based on share prices rather than earnings.
–said S Naren,CIO,ICICI Prudential Asset Management