Its been a sharp and fast journey since we last met. The markets sanity is much more in question now. The Sensex has moved from 10500 to 12500 and an imminent fall does not appear around the corner ( This could be a classic contrarian call for all you know!! )
The valuations are now in the scary zone, we have warnings about the "bubble" formation in Indian Stock Markets but is anyone listening? We have talks of sensex 45000 and 77000 in a decade! Doesn't all this sound familiar?
More and more cocky self confident bulls, "analysts", "experts", "free tip givers", and that contradictory beast the altruistic capitalist roam the the trading forums. We have intense debate on the various holy grails, the next "hot tip" , the best technical indicator and also elaborate strategies which at the end leaves one more exhausted then profitable.
What should one do in these conditions is the major question. We would suggest staying away from hot tips like your life depended on it. Trade with a limited profit and time horizon, never leave a trade open to risk of a big drop. Remember 500 points could melt easily in this 12500 levels. Your pocket cannot bear such shocks.
There are ways to enjoy the bull run and still limit your risk. Look for those opportunities. We would be sounding pompous if we suggested strategic option plays as the safest way to enjoy the profits while limiting your risk but that is the truth.
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