Almost 7 months ago in my last post in January, I had posted a list of 5 stocks as a study for short term trading and the market crash started soon after that month. Few weeks after that I was embarrassed to see that they performed poorly.
In the meantime I learned more things about filtering stocks and especially the short term filters and wanted to revisit this list before I could continue posting anything further on this blog. At various times I noticed these stocks and surprisingly noticed them to rebound faster after the market crash in March. What is better than systematically and simply comparing their performance after 3 weeks from filtering and after 7 months now? So here we go about that without wasting much time.
Here I am posting table comparing their LTP on 22-Jan-20 (the day the stocks are filtered), 12-Feb-20 (after 3 weeks), 20-Aug-20 (yesterday after almost 7 months).
| |
On the day found |
After 3 weeks |
Yesterday (After
7 months) |
| Scrip |
LTP
on 22-Jan-20 |
LTP
on 12-Feb-20 |
LTD
on 20-Aug-20 |
| RPGLIFE |
330.95 |
285.95 |
375.6 |
| GSS |
43.9 |
36.3 |
27.05 |
| TANLA |
72.25 |
83.3 |
198.8 |
| PRICOLLTD |
58.6 |
59.9 |
39 |
| SUNFLAG |
42.6 |
39.85 |
48.9 |
Not getting the table as it is, on blogger, so putting the same as picture below:
Now let us compare the % change.
| Scrip |
% Change After 3
weeks |
% Change Now
(After 7 months) |
| RPGLIFE |
-13.6% |
13% |
| GSS |
-17.3% |
-38% |
| TANLA |
15.3% |
175% |
| PRICOLLTD |
2.2% |
-33% |
| SUNFLAG |
-6.5% |
15% |
Same thing as an image:
We can see that RPGLIFE, TANLA and SUNFLAG have fared better giving more than 10% returns with TANLA having done exceptionally well at 175% change. GSS and PRICOLLTD were the bad ones.
I actually had bitter experience with Pricolltd which did poorly and again got bitten by it in April (I do not learn with one bite). I never did anything with GSS but seeing its earlier performance in the last year, I was skeptical of it. I also bought TANLA and held through March only to book losses in April. It consolidated for quite sometime in May-June. I had tested again in June and got out for only 10% to watch it rise multifold from my exit at 77 to 199 now and still rising with Upper circuit close yesterday.
What do we learn from this? Let us check the cumulative gain if someone had invested equally in all stocks at about the same price level as on 22-Jan-20.
| Cumulative
performance with equal amount in each stock |
% Change After 3
weeks |
% Change Now
(After 7 months) |
| Net % gain |
-4.0% |
26.3% |
Same thing as an image:
So we can quickly conclude that these were better not for short term trading but for long term investment. 26% return in 7 months time is quite good.
While I was embarrassed for never being able to make good stock filer for short term selection of stocks, in February after 3 weeks from the time posted that I thought I did this post just at the wrong time. This post kept reminding me that I am not good with short term selection of stocks.
Long time ago in 2011 July, I tried similar posting of two stocks, PAPERPROD and PETRONET. Below is the link for it.
A month after that I did a review of performance of those two stocks.Below is the link for it.
As we can see, both gained close to 20% after a month. When I posted the expectation was they rise within two weeks. But they actually rose after two weeks.
It is only two months ago that I began to realize that my stock selection is not good for short term but rather very good for long term. I used to notice PAPERPROD in the later years too for its good performance and I was not quite systematic about what I filtered and when it did better in those days. As I remembered this past post, I realized now the same thing happened this year too.
Back in those days I filtered stocks seeing price action on candlestick chart. That is why I posted charts for each. Over time I refined my selection criteria. But even now I realized timing is not certain. However when we make a list of stocks, after two weeks few could rise and few could fall. If the rising ones beat the falling ones, the list is still a winner. From here on I will do such study and post their performance after two weeks.
Now back to long term thing. I was also mentioning about debt and pledge % along with quarterly result date. The first two are fundamental filters for long term selection of stocks. The third is to estimate the time of big move based on the earnings calendar. This is more suited for short term selection than the first two. As I used first two, these eventually turned out to be good.
How could the two bad ones have been avoided? Looking at the charts, all looked good except GSS. So GSS was clearly an outlier and could have been skipped. It was jumping up fast just at the time of posting so I noticed it. PRICOLLTD was the hard one to avoid.
Later in May-June timeframe I bought and sold SUNFLAG from 31 to 39.95. Missed TANLA and RPGLIFE. Now that it has become clear about long term I keep these three in my long term watch list.
I will post from now on a stock list for 2 week watch, on any given day I can post it up. No fundamental check here. And study the list performance after two weeks. Let us see how this goes.
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