Tuesday, September 15, 2020

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Review of Performance of 31-Aug-20 Stocks List


Let us review the performance of the stocks list posted based on 31st August closing. We had a total of 3 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
HERITGFOOD 361.55 333.55 361.55 352.95 0 5.8 0 -2.4
NETF 116.89 111.89 138.15 135.82 1 21.4 18.2 16.2
TIPSINDLTD 188.65 187.5 305.1 297.2 1 58.5 61.7 57.5

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: 2.5% (gain)

Net gain on capital in scenario 2: 23.8% (gain)

Net gain on capital in scenario 3: 26.6% (gain)

Net gain on capital in scenario 4: 28.6% (gain)

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

I am very happy today. Because after so many days of seeing negative returns from this strategy, we see huge returns all of a sudden today. This validates my method. Also there are two lessons we learn from this.

One is that the best time to select stocks from this list is when the market is pulling back. On good days many stocks go up and it is difficult to filter a strongly trending stock from the big list. They automatically shine when the rest are struggling. 31-Aug was the day Nifty had a big bang fall in the recent months. TIPSINDLTD with stood that. HERITGFOOD also showed up but it didn't make big loss though. That is because we have this two week period after which any selling can get accelerated. Most unlucky positions can be closed within this time period before they get worse.

Another thing is that having bought stocks after a market fall, we would not have to be afraid of further falls in the market. As the rest of the market stabilizes either these stocks rise with momentum like the case of TIPSINDLTD or just stable to limit the loss like HERITGFOOD. Two more weeks down the line, anything can happen. But the two week timeline helps us this way.

The scenario 3 and 4 gains are not too far from the 2nd scenario gain. When we hit a jackpot, we get the most gain. Scenario1 is very small gain because when we sell stocks with limit orders we limit the gains.

We can also take a corollary from this. The stocks that we filter on other days can be observed in watch list, while also finding out news/other information. So a position can be taken after a pullback in them. Just like taking a position in a stock found on market fall day. 

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