Friday, September 18, 2020

Review of Performance of 04-Sep-20 Stocks List

Let us review the performance of the stocks list posted based on 4th September closing. We had a total of just 5 stocks in the list on that day. I will not post the same list again. That can be reviewed here.

company symbol buy price min price max price 10th day price target met % gain min. to 10th day % gain buy day to max. % gain buy day to 10th day
AMBER 1835.65 1770.05 2065.1 2037.85 1 15.1 12.5 11
CYBERTECH 57.2 57.2 67.05 62.3 1 8.9 17.2 8.9
EIMCOELECO 348.1 330 348.1 346.2 0 4.9 0 -0.5
GENUSPOWER 26.45 25.5 29.9 29.1 1 14.1 13 10
RELAXO 656.65 635.6 675.75 673.8 0 6 2.9 2.6

Same table as a picture.

You can click on it to see in full size.

Analysis of Performance

Net gain on capital in scenario 1: 3.4% (gain)

Net gain on capital in scenario 2: 6.4% (gain)

Net gain on capital in scenario 3: 9.1% (gain)

Net gain on capital in scenario 4: 9.8% (gain)

For details of each scenario, you can go through the explanation given for 20th August list review.

One point I will re-iterate here which was concluded from the review of 31-August list, is that today's good performance coincides with another day of NIFTY's bad fall day. The 4th September was 4th day after 31-August and the second day when Nifty fell badly from that time. The list was small with only 5 stocks on that day. Those did well, showing another point we learned during these performance reviews. It is that the stocks showing up here, may not all rise at the same time, but after a time period of even a slight sentiment change from negative to positive (this is important as I am telling from my experience), some stocks gain and some do not fall badly so as to result in a good overall gain. Such days are important to pick short term stocks. That means if we pick stocks from such time, the 10 day rule need not be applied to constrain the situation. Relaxing time will help wait till sentiment changes, atleast slightly, which is enough for the overall portfolio to come to profit. Keep this learning in mind.

From Monday post onwards I will not do daily performance reviews. There is no point in doing this daily. Further filtering is anyway needed. The daily list means one will pick stocks from different dates whenever familiar or good fundamental stocks show up or stocks with investor interest show up. To that end, monthly performance review or weekly is good enough.

The lists can be used as a statistic of the market to guage sentiment and to build watch lists. 
Lists can be made for medium term (from stocks with investor interest or significant news) trading, long term trading (from stocks with fundamentals passing LINDY EFFECT), jackpot trading and short term option trading opportunities in large caps or NIFTY stocks. As we see from above large paragraph of a learning point, this list is good to keep track for different days to see which stocks to pick due to their relative good performance in a weak market vs. which stocks to, perhaps, offload from portfolio due to their relative bad performance in a bullish market.

There was another statistic for NIFTY stocks that I was thinking of, based on the ORB strategy performance data. I will post the background for that and start the statistic, as it can help with some trades for those who can do.

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Stock Selection List Short Term Study (2 Weeks Timeframe) for 18-Sep-20

Since mid of August, I have started doing this as a study so the readers of this blog can learn along with me. I am also giving valuable list of stocks for quick profit. If anyone bought Kiriindus and Trent on the morning of 25th August as they showed up in 24th August list, they would have gotten a profit of 4-6% by evening.

I got inspired for this selection when I once noticed Indigo on daily chart and next day bought its CE at 9 and sold at 18 after few hours. Later traded TNPL, INFIBEAM, DIAMONDYD, JOCIL, BLISSGVS, ATULAUTO, during mid weeks of August and booked about 5% profit in a short time. Every stock may not rise the very next day. But I observed the potential for a rise in the next 10 days, on few stocks over a historical period of five years. Thus I decided to make such list everyday and trade familiar stocks or observe them for building trading watchlists to grow familiarity to trade later.

Today's short term selection list for short term study (2 weeks timeframe). Their performance will be reviewed after 2-Oct.

company symbol today's close price % rise today
AIAENG 1865.7 6
AIONJSW 19.4 4
APOLLO 127.3 10.9
ARROWGREEN 50 4.9
BAYERCROP 6352.2 6.8
BETA 101.7 16.5
BIRLAMONEY 43.4 8.9
CAREERP 170 7.2
CIPLA 806.3 7.3
DEVIT 111 0.9
DIVISLAB 3344.4 4.1
DYNPRO 229.3 7.6
EMKAY 58.5 7.1
GATI 50 6.6
GEOJITFSL 40.8 5.8
GLENMARK 508.9 3.3
GPPL 89.5 7.7
IVZINNIFTY 1238.8 0.3
KOTHARIPET 17.4 9.8
NATCOPHARM 890.8 15.2
ORIENTABRA 21.6 14.3
PGIL 150 4.8
PODDARMENT 211.3 12
RAJESHEXPO 509.4 10.8
RELIGARE 45.9 2.1
RPGLIFE 405.1 8.1
SUVEN 56.5 9.5
TOKYOPLAST 63.3 7.3
VIMTALABS 116.7 4.2
VSSL 78.1 5

Same table as a picture.


Commentary:

Today market didn't fall a lot. We have 30 stocks showing up in the list. Among them AIAENG showed up today. It got very high volume today and surprisingly went up. I got biased from last 3 days fall. I was thinking of selling it today but be after 3.15pm, it was going up. I held it.

I have divislab too as it is in my long term watch list and recently bought one more time on pullback. Rather CIPLA from Nifty had a great move today. It was up yesterday and I noted it. As buying CE is good on a pullback, I didn't consider further potential movement. An OTM CE yesterday and an ATM CE in the morning would have given great gain. That OTM might have turned ATM today. Divislab had a much higher move in the last few months than CIPLA and coming into NIFTY after this month expiry (from next Friday). CIPLA didn't move for a month, so it got its time. This rotation keeps happening among good sectors/stocks in this kind of market till majorly impacting news comes for either the market as a whole or for the specific company. M&M is also in good shape today after not moving for more than a month. I have traded options of CIPLA and M&M a month ago. So I noticed this.

For Nifty options trading, I need to expand my trading from a small list. Watching fifty nifty stocks is difficult. Reducing them to 15 also doesn't seem to help as I still missed these two and ZEEL. Maybe I can start another post, not daily but whenever opportunity comes, keeping track of few NIFTY stocks for option/future trading opportunities. I will start with 10 different stocks and post in a new series.

Similar to this stocks list, my short term stocks also showed gain today despite small falls in mid/small cap indices. RPGLIFE that I had mentioned earlier as a stock with investor interest was at good spot to buy few days ago. Same with Bayercrop too. But I didn't do because I already had enough stocks. However now I realized if some stock has already pulled back for more than 3 weeks and shows up at good entry spot, we can buy if those are the type having investor interest. RPGLIFE is not a strongly trending stock but it pulls back and goes to new high. So good for medium term trading again and again.

Given that the economy won't immediately sprung back to action now, our markets too could be range bound or swinging phase for next two years. Usually that happens after major downtrends. While economy won't recover fast and gives lot of pain for long term investors to see their share prices going up and down, not going anywhere far, for medium term traders it is not a problem. Only once the earnings rise strongly after few years, do markets also go up with strong momentum for one or two quarters. Like it happened in part of the year 2017 and 2007.

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Thursday, September 17, 2020

Review of Performance of 03-Sep-20 Stocks List

Let us review the performance of the stocks list posted based on 3rd September closing. We had a total of just 12 stocks in the list on that day. I will not post the same list again. That can be reviewed here.

company symbol buy price min price max price 10th day price target met % gain min. to 10th day % gain buy day to max. % gain buy day to 10th day
3IINFOTECH 3.55 3.55 3.85 3.55 1 0 8.5 0
ABCAPITAL 71.25 68.65 72.65 70.45 0 2.6 2 -1.1
APCL 161.95 161.95 203.5 197.5 1 22 25.7 22
BIRLAMONEY 41.3 39.2 42.7 39.85 0 1.7 3.4 -3.5
IDEA-1M 12.65 11.05 12.65 11.35 0 2.7 0 -10.3
INDORAMA 19.9 19.15 23 23 1 20.1 15.6 15.6
INTELLECT 191.65 185.3 215.65 215.65 1 16.4 12.5 12.5
JAMNAAUTO 44.6 43.95 50.1 49.1 1 11.7 12.3 10.1
KOTARISUG 15.65 14.85 16.8 16.3 1 9.8 7.3 4.2
MADHAV 26.2 23.45 30 27.95 1 19.2 14.5 6.7
PHILIPCARB 129.45 114.05 129.45 123 0 7.8 0 -5
PLASTIBLEN 210.95 194.2 210.95 198.4 0 2.2 0 -5.9
UNIENTER 67.9 63.5 69.3 69.3 0 9.1 2.1 2.1
VARROC 329 300.8 329 321.8 0 7 0 -2.2

Same table as a picture.

You can click on it to see in full size.

Analysis of Performance

Net gain on capital in scenario 1: 0.7% (gain)

Net gain on capital in scenario 2: 3.2% (gain)

Net gain on capital in scenario 3: 7.4% (gain)

Net gain on capital in scenario 4: 9.5% (gain)

For details of each scenario, you can go through the explanation given for 20th August list review.

Now that we got an idea of how the stocks showing up in the list are performing, there is no need to keep on reviewing performance for every list. Once a month performance review can be made. From that some further filtering may be made to select stocks for long term or medium term trading. I can continue posting the lists as a market statistic and to build stock watch lists. Meanwhile I can work any other way of getting stock lists or techniques for short term trading and post such lists as next good bets once a week or so.

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Stock Selection List Short Term Study (2 Weeks Timeframe) for 17-Sep-20

Since mid of August, I have started doing this as a study so the readers of this blog can learn along with me. I am also giving valuable list of stocks for quick profit. If anyone bought Kiriindus and Trent on the morning of 25th August as they showed up in 24th August list, they would have gotten a profit of 4-6% by evening.

I got inspired for this selection when I once noticed Indigo on daily chart and next day bought its CE at 9 and sold at 18 after few hours. Later traded TNPL, INFIBEAM, DIAMONDYD, JOCIL, BLISSGVS, ATULAUTO, during mid weeks of August and booked about 5% profit in a short time. Every stock may not rise the very next day. But I observed the potential for a rise in the next 10 days, on few stocks over a historical period of five years. Thus I decided to make such list everyday and trade familiar stocks or observe them for building trading watchlists to grow familiarity to trade later.

Today's short term selection list for short term study (2 weeks timeframe). Their performance will be reviewed after 01-Oct.

company symbol today's close price % rise today
ADORWELD 282.7 8.7
DCMSHRIRAM 380.3 4.3
DCW 15.3 8.9
MCDHOLDING 27 9.1
NESCO 585.8 5
SONATSOFTW 336.6 5.2

Same table as a picture.

Commentary:

Today only 6 stocks showed up as the markets pulled back today. Now US markets too are doing the same. This is not like a crash but the sentiment hasn't turned decisively to bullishness. The markets can continue doing this to give second chance to trapped investors to exit, who got trapped at recent high levels before 31-Aug.

As there is no major news other than the US elections that can impact the market badly, there is remnant effect of recent upward momentum. "Remnant Effect" is a term that I have been using for more than a decade to identify the situation where there is some balance left after a major event happened. Here we had a four month rally in Nifty and many stocks. So even after the sentiment changes, this remnant effect gives a second chance to exit. In case a bad news comes, the market would be vulnerable once the remaining bullishness is exhausted. If there is no major bad news, the markets would trade in range like a falling channel, rising channel or as a consolidation phase. These situations are opportunities to trade for short term in some stocks or medium term trades with rotations across long term stocks.

Sonata software showed up on 8-Sep at 318. It's a good move from there. DCM Shriram showed up on 26-Aug at 397. It went down till 330 and bounced off 100 DMA. If one were to think of this for little longer term, one should only try medium term as its long term over years is bad and at best a range trade but of a falling channel type. SIP would only get you out without loss if you patiently waited and sold at the first opportunity of recovery. So every year or basically after every major event (like demonetization, covid-19 lockdowns, IL&FS crisis, now ballooning moratorium crises, etc.) we need to observe which stocks recover and go to new highs. Those are the ones to keep trading for medium term again and again till you will be left banking on second chance to get out because of remnant effect. Once you realize that it was remnant effect that got you out of the stock and didn't make much profit due to its weakness to make new highs again, you need to switch to new set of stocks.

As news plays important role in the market, I need to focus on that. But not all news matters. There is no need to keep checking news all the time like a madman. Like I said before, stocks with investor interest don't care about some low-impact news. See how Shredigcem is quietly rising while other similar stocks that have gained while it fell, are now falling while it is relatively falling less and made good rise yesterday. That is simply profit booking in some stocks and money rotation into stocks that didn't gain much relatively. This view based on money rotation and profit booking combined together, can help do medium term trading.

As I said in earlier posts after noticing Zeelearn in 27-August list, I mentioned about its sector stock NIITTECH. Actually NIITTECH is software and NIITLTD is its pair. NIITLTD is in same sector as  ZEELearn. Seeing COFORGE (renamed NIITTECH) chart, I felt it missed the rally relatively for last month, so I bought it at 1936. Now it is nicely showing 16% gain without giving a pullback to buy more. I didn't check any news about it. But IT stocks had some rally in the beginning of July quarter and then took break. Then pharma rallied and now taking break. IT and Pharma are two sectors doing well in this pandemic. So there is no need to check news once they have bullish bias for the sector itself. Chemicals is another sector that recovered well but took break recently. Alkylamines, Balamines are good there. JOCIL is also there which shows in these lists. When it does I can pick up Balamines.

If you liked this post, please check any of the Reaction boxes below and subscribe to this blog or follow by adding email on the right side of the blog. If you want to post any questions or share thoughts, feel free to add comments below.

Read the disclaimer on the right side of this blog (in desktop mode) before making any investment/trading decisions.


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