We had NIFTY at 10792 on February 28, 2019.
Yesterday, the close was at 12113.45.
A very robust gain of 1320 points in a year has brought cheer to those who were invested in the right stocks.
On this blog we have been mostly identifying weak stocks. Buying PUT options in these stocks has delivered good profit at times and failed at other times but has kept us profitable over a longer time frame.
Today we have a look at how the weak trend continued in stocks selected by us one year ago.
This is the chart at close of February 2019 trades:
In the above chart entry dates are also mentioned. As we base the trades on previous day’s closing price, we can have a proper comparison now.
ZEEL was at Rs. 380.20 on January 31, 2019. Yesterday it was Rs. 238.75.
M&M was at Rs. 680.05 on January 31, 2019. Yesterday it was Rs. 523.
GRASIM has moved up from Rs. 721 to Rs. 743.05 in the same period.
HINDPETRO has moved from Rs. 226.50 to Rs. 233.85 from February 04, 2019 to February 14, 2020.
IDEA traded at Rs. 32.00 on February 07, 2019. A year later the price is Rs. 3.40. A loss of more than 90% in one year.
HEROMOTOCO traded at Rs. 2799.95 on Feb 12, 2019. Now it quotes at Rs. 2356.50.
LT has moved up from Rs. 1261.75 on February 08, 2019 to Rs. 1295.15 on February 14, 2020.
SUNPHARMA was at Rs. 423 on February 15, 2020. One year did nothing for this stock and closing price yesterday was Rs. 418.55.
BHEL was at Rs. 62.25 on February 08, 2019. Now it has moved down to Rs. 36.20.
VEDL was at Rs. 164.65 on February 27, 2019. It trades at Rs. 141.10 now.
Out of 10 stocks selected as weak in February 2019, 7 are trading lower on February 14, 2020 in spite of NIFTY having moved up by more than 1300 points in the same period.
The 3 which gained have shown very little gains and do not compare at all with the NIFTY gain.
And people tell me that market is bullish. What bullshit.
We could find stocks with majority of them losers in a year, bullish market or not.
We should keep the focus on what we do and not be disturbed by the noise in the market.
The lesson learnt is that weakness in stocks just does not go away. It is there for a reason ( nobody tells us that reason ) and stays there till those reasons go away. Weak stocks do not move up with the rest of the market except in some random moves. One can look at RCOM, RPOWER, RELCAPITAL, RELINFRA, SUZLON, UNITECH, YESBANK, DHFL etc for real learning and education.
The word education has made me remember one much touted name in the year 2010-11.
EDUCOMP was traded at Rs. 654.30, ten years ago on February 15, 2010.
The price on February 14, 2020 is exactly Rs. 1.00.
It should certainly teach us about weakness.
This was the story for the day.
Enjoy the weekend.