creameeee said:
there r some of the penny stocks which one of my very trusted friend tracks.he had given me some very beneficial tips in the past so i thought i shud share such stocks with my friends so that they can also make some quick returns.latest tips are:
BHANDARI HOSIERY: CMP-11 TGT-20 {I HOLD}
UNIPRODUCTS :CMP- SOMEWHERE ABOVE 50 {MEDIUM TO LONG TERM TGT-100} {I HOLD}
EXCEL GLASS {CHECK OUT THE SPELLING}:CMP-18+ TGT-30+
I WILL UPDATE ABOUT EXCEL GLASS AFTER ASKING HIM BUT TRACH THESE TWO FOR A START
Many investors/traders have taken positions in these penny stocks. I am curious to know how these stocks and the investors/traders have fared in this so called market crash.
it would be helpful to indicate if these stocks were selected only from technicals point of view or there was any fundamental analysis going into this.
Traderji had deleted many of the posts and warned the members to keep away from such stocks for various reasons.
Personally I hold only ispat ind and had asked from traderji about that. His predictios are correct. But I am holding the stock to teach myself a lesson in penny stocks.I keep tracking it to understand the penny market and sentiments. I wouldnt mind losing a small sum.Otherwise I would advise everybody to keep away from penny stocks at all times. Sob stories are built from investments in such stocks.
After going through the messages and market for over a year and seeing my portfolio to increase from base value to more than one lakh and shrinking it to about 30000 and then again going up to one lakh and shrinking it to 65000
I feel some lessons which I learnt by observation is in order for members to conder and analyse if interested.
1. What is penny stocks?
a) Though, it is not determined by the price alone but generally stocks with median price of Rs. 20 and mode price of max Rs. 30-40
b)Average daily trade is less than 5000
c)Stocks trades only for 20 days in a quartely cycle
d) Stocks have not traded at all for last one year.
e) the company is refered to BIFR i.e. it is a sick company
f) it is in loss for three years
g) networthworth is eroded.
h) It is in the sectors which are in general downtrend mode for two years.( However one has to keep track of cyclical sectors)
i)Management has shaddy track record.
These can be refined and stocks can be classified as penny stocks and investors and traders may be advised to keep away fom such stocks. though some may make lots of mone but many more end up parting with it.
2. There are
trading stocks and some are
growth stocks
For a two year perspective trading stocks have defined highs and lows and price line is a variant of sine curve. It may be in trending mode i.e. generally going uo or going down but confined to a broad channel of high and low.
3.
Growth stocks will be in trending mode and will be confined to a narrow channel of highs and lows. But company will be in growth sector and will show either loss or no profit as returns will be ploughed back to fuel the growth/expansion. ( To be verifed with the Financials). Management will be well articulated and clear in communication of their growth strategy. The company will be highly visible and assets will be well documented and quanitified and information available to publich through various means and will be verifiable.
Generally, such stocks may be found in midcap sectors which are on a growth path.
In large cap stocks you will have to find companies doing bad and avoid such companies. Large cap stocks will have more peer pressure to perform or be target of M&A. Analyse bad news flow critically and see if in worst case senario the company will sink or not.
Though you should have faith in the company you invest but remember you are not married to them. Keep your stop loss and exit when
you think it is not giving returns on your capital deployed.
I hope these novice observations will be further refined by others and will be useful to others.
Thanks
Pankaj
