Hold Em and Fold Em

When most analysts, financial planners, fund specialists and investors try to decide whether to buy a particular stock they immediately go to the financial statements to determine the growth potential of the company. Numbers and more numbers. Then management analysis and industry speculation. Unless you are an experienced financial analyst (and there are not very many good ones) the numbers in the reported statements can be very misleading - just as the company Controller wants them to be.

Let's not consider fraud as there has been plenty of that both here and abroad. They are all honest (I hope). Most corporate executives want to remain within the law so they report statements that are true to the FASB - Financial Accounting Standards Board.

As the old saying goes, "Numbers don't lie, but liars can figure". If you are good with accounting techniques you can make a bankrupt company look good - on paper. On CNBC-TV many folks watch the CEOs telling a great story about their company. You sure don't expect them to tell you the whole truth and nothing but the truth, do you? That is why I always hit the mute button. And many times when you look to see what the insiders are doing in this wonderful (?) company this executive and his buddies are selling out.

Then there is Morningstar that gives us those twinkling heavenly bodies. Nothing like a 5-star mutual fund - that has lost money for the past 4 years. So much of their information is old and if they know it you can be sure that has already been factored into the current price. How about those peer groups? Suppose this particular peer group is ranked 99th out of 100 or even 15th or lower. One question: why do you still own it?

Why are you putting your money in the stock market at all? The idea was to make more money. Right? Yet the majority of little investors will hold a stock or mutual fund while it goes down and down. Wouldn't it make more sense to sell out once it loses a certain percentage from its highest price after you buy it? If you bought it at $20 and it is now $40 is it now time to sell? I don't know so why not let the price action tell you. If you only wanted to risk 10% when you bought your stop-loss would have been $27. It now should still be 10%, so you will be out at $36 if it starts down. Suppose you tracked that stop all the way up to $80? This is why I have always preached that stops make you money.

The best (?) analysts know very little more than you. They just have a bigger vocabulary about the market. You and your dart board can do as well. All any truly smart investor needs is common sense and the ability NOT to fall in love with any position. Know when to hold 'em and know when to fold 'em.

Al Thomas' book, "If It Doesn't Go Up, Don't Buy It!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter at http://www.mutualfundmagic.com and discover why he's the man that Wall Street does not want you to know.

Copyright 2005

In The News:

I would always recommend mutual funds over individual stocks: Anand Rathi  LivemintThe effort needed to manage individual stocks is much higher than the effort required for mutual funds.Anand Rathi talks about the ongoing economic slowdown ...
What India’s top three mutual funds bought and sold last month  LivemintInflows into Indian equity mutual funds rose for the fourth straight month in August even as the nation's stocks suffered their worst three-month period since 2016.
Ashok Leyland, YES Bank, PNB Housing among 30 stocks AMCs bought, sold in August; do you own any?  Moneycontrol.comInflows into equity funds improved during August to Rs 9152 crore from Rs 8113 crore in July 2019.
Should you invest in small cap mutual funds now?  Economic TimesMany wealth advisors believe that investors could go for a staggered investment in small cap mutual funds.
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Top stocks mutual funds bought and sold in August 2019  CNBCTV18Domestic mutual funds remained net buyers for a fourth straight month, resulting in an overall inflow of Rs 1.02 lakh crore in August, much higher than Rs 87000 ...
Best small and mid cap mutual fund managers 2019  Economic TimesHere are the top 5 fund managers in the small and mid cap category who have created the most wealth for investors.
Top 30 stocks that fund managers bought & sold in July; do you own any?  MoneycontrolMutual funds net bought Rs 14,846.75 crore worth of shares last month. Their inflows into equity funds also improved to Rs 8,113 crore in July, rising nearly 6 ...
ET Markets Special Podcast: How will market react to FM economic booster come Monday?  Economic TimesHi, this is Saloni Goel and you have tuned into ETMarkets' Special Podacast. Equity investing may look easy when stocks are down in the dumps, but separating ...
Franklin India Feeder - Franklin US Opportunities Fund: A good avenue for exposure to US stocks  BusinessLineGeographical diversification and unique opportunities bolster case for investing.
Diversify your portfolio by investing a portion in US-focused mutual funds  MoneycontrolDeveloped markets such as US have delivered significant returns over market cycles.
Heads up! Time to get into small & midcaps; 10 stocks looking attractive for long term  Moneycontrol.comIt is time to take note of small and midcap stocks, as most experts say the valuations are looking attractive and the froth in the broader markets seems to have ...
Stock market investor? Here are a few tips for making timely exit  Business StandardIn the Mahabharata, Abhimanyu, son of Arjun, knew how to enter the chakravyuha but was not aware of how to exit it. This cost him his life. Many stock market ...
Stock market crash? No Problem: Here are 4 steps to embrace it with a 'bear' hug  MoneycontrolThe stock market crash is the best excuse you can use to rebalance your portfolio. Getting rid of the non-performing investments and realigning your portfolio.
Which cap fits best? Mutual Funds  India TodayEquity markets have, over the past two months, seen significant correction. Their bellwether index, the S&P BSE Sensex, has corrected around 10 per cent (as ...
When equity mutual funds offer negative returns, here’s what you do  Economic TimesThe need of the hour is to stay insulated from the panic in the market.
Mutual Fund Update: Stocks that attracted fund managers in July 2019  Dalal Street Investment JournalIf we look at the June 2019 data, we find that the financial sector was the one that was on top of the buying done by the fund managers. Even in the month of July ...
Mutual funds are not there to provide risk capital: Sebi chief  Economic TimesMumbai: Mutual funds are not banks and are not around to provide risk capital, said Securities and Exchange Board of India chairman Ajay Tyagi. The capital ...
Growth Stocks: How This Hot Mutual Fund Seeks Winners, Avoids Also-Rans  Investor's Business DailyJanus Henderson Forty Fund is a bottom-up investor in growth stocks. But it can't ignore macro risks like a technology cold war between the U.S. and China.
Hot and Cold Stocks of Mutual Funds in July 2019  MoneylifeIn July 2019, IndusInd Bank and ICICI Bank were the most preferred stocks of Indian mutual funds.
Best Mutual Funds Invest In IBD 50, Large Cap Stocks Like Visa, PayPal, Twitter  Investor's Business DailyIn addition to Twitter, Microsoft and Paycom, the best mutual funds are investing heavily in Visa, Mastercard, Global Payments, PayPal and Paysign.
Mutual Fund Investment: 5 reasons to invest in tax saving mutual funds  The Financial ExpressWhile there are various tax-saving investment options such as NPS, NSC and PPF, among others, tax-saving mutual funds have remained the most preferred.
It is better to buy smallcaps via mutual funds: Arun Thukral, Axis Securities  Economic TimesLack of GST cut in autos can really be a dampener because the market is hoping that something of this sort may come or maybe a scrappage policy could be ...
Planning to invest in small cap funds? Spread your risk via SIPs  Economic TimesWealth managers are advising investors keen on looking at battered small cap shares to start systemic investment plans (SIP) in schemes that bet on these ...
Mutual funds see inflow of Rs 1.02 lakh crore in Aug  Economic TimesNew Delhi: Mutual funds' asset base increased to Rs 25.47 lakh crore in August, a rise of 4 per cent as compared with the preceding month, on the back of ...
Sundaram Mutual Fund garners Rs 358 crore via equity fund NFO  Moneycontrol.comSundaram Mutual Fund has collected Rs 358 crore from 30,932 investors through the launch of Sundaram Equity Fund, according to a press release from the ...
How retail investors tripped up on Yes Bank – Zerodha CEO releases data in blog post  LivemintZerodha CEO said 2 lakh people out of the 7 lakh who have demat accounts with Zerodha, hold Yes Bank stock and his clients are collectively sitting on an ...
Motilal Oswal NFOs may suit investors keen on passive mutual funds  Economic TimesInvestors looking to include low-cost passive mutual fund schemes in their portfolio could consider the new fund offerings (NFOs) of Motilal Oswal Asset ...
Resilient U.S. Growth Propels Stocks as Trade Fears Ease  The Wall Street JournalInvestors are piling back into stocks and unwinding massive bets on haven assets, illustrating renewed faith that a resilient U.S. consumer can continue ...
Big relief for stock market, equity mutual fund investors; Enhanced surcharge withdrawn  The Financial ExpressThe FM has announced relief from the enhanced surcharge on the long term and short-term capital gains arising in the stock market transactions.
Yes, Passive Investing Has Exploded. But Here’s Why Fears of a Bubble are Overblown  FortuneConcerns are growing that passive investing is dangerous for the global markets. Here's why you shouldn't change up your investment strategy.
Mutual Fund Update: Stocks sold by fund managers in July 2019  Dalal Street Investment JournalIn our last update we listed the top 5 stocks that attracted fund managers in the month of July 2019. Now let's have a look at top 5 stocks that witnessed a lot of ...
L’Affaire CG Power a pain point for Yes Bank and mutual funds  Economic TimesSome of Indias biggest mutual funds hold substantial stakes in Gautam Thapars CG Power.
Equity mutual fund managers buy the dip amid a huge downturn in market  Business StandardDomestic money managers lapped up shares of several companies amid a huge downturn in the market last month. Equity mutual funds (MFs) bought shares ...
End of Era: Passive Equity Funds Surpass Active in Epic Shift  BloombergIt's official: inexpensive index funds and ETFs have finally eclipsed old-fashioned stock pickers.
10 Superb Defensive Stock Funds  Morningstar.comEven infrequent readers of Morningstar.com probably know that when it comes to stock investing, we're advocates of a wide-moat approach: We favor ...
Sebi wants MFs to invest only in listed securities  Economic TimesSebi said it has also decided to give flexibility to MFs to invest in unlisted NCDs up to a maximum of 10% of the debt portfolio of the scheme.
Sebi allows mutual funds to tie up with banks to rejig exposure  Economic TimesMumbai: Mutual Fund (MF) houses can now join hands with banks to rejig exposure and throw lifeline to stressed corporates --- albeit with a few conditions.
Financial Stocks See Worst Foreign Fund Outflows In Over Seven Years In August  BloombergQuintBanking and financial shares saw the worst foreign fund outflows in seven-and-a-half years in August as overseas investors continued to sell after Finance ...
How to calculate weighted average returns using MS Excel  Economic TimesA combination of MS Excel functions proves effective when diverse amounts are invested across options.
9 Top-Rated ETFs to Buy  U.S News & World Report MoneyThese funds provide the best diversified exposure to the stock market.
How much money can I make in mutual funds?  Business Insider IndiaA large number of investors are investing in mutual funds to grow their money. As is the case with any investment instrument, your money can yield very high.
Mutual Fund Trend: Infosys, REC and UPL among most sold stocks by MFs in July  Zee BusinessMutual Fund Report: Domestic equity mutual fund inflows continue to show resilience despite market volatility, with July inflows touching Rs 73 billion – a 9M ...
9 steps to protect your finances against recession in the economy  Economic TimesBad news is infectious. As reports of job losses, slowing demand and the liquidity crisis trickled in last week, the stock markets slipped. To be sure, the Nifty has ...
Another recent inversion could provide support for US stocks  Economic TimesNegative yields on government debt in countries such as Germany and Japan have also helped to depress those on US Treasuries.
Good time to invest in India with a long-term view: Mark Mobius  Moneycontrol"India will continue to grow in the long-term, but there is a lot of confusion w.r.t taxation," Mark Mobius, founder of Mobius Capital Partners LLP said in an ...
CNBC-TV18 Market Highlights: Sensex ends 281 points higher, Nifty above 11,050; OMCs gain, BPCL up 6%  CNBCTV18Indian shares ended higher on Friday, tracking gains in Asian peers, led by oil & gas, banking and auto stocks. The Sensex ended 281 points higher at 37385, ...
Weekly Wrap: Defensive Funds, Rating Updates, and How Much You Need to Retire  Morningstar.comWe recap the week on Morningstar.com and note the most popular stocks, funds, and ETFs.
Buy these 15 handpicked stocks for 11-44% return in next one year  MoneycontrolNifty corrected more than 1,000 points in the last two-and-half-months from its record high, dented by the economic slowdown, liquidity crisis, dismal earnings ...
ITI Mutual Fund mulls slew of scheme launches in next few months  MoneycontrolThe fund house which began its operations with the launch of ITI Liquid Fund and ITI Multicap Fund in April 2019 and ITI Long Term Equity Fund in July 2019 is ...
Growth Stocks: This Mutual Fund Wins With Big Bets On Disruptive Companies  Investor's Business DailyManagers of Virtus Zevenbergen Innovative Growth Stock Fund identify growth stocks they like the best. Then they bet just on those select few.
Passive Funds Outshine Actively Managed Ones: 3 Winners  Yahoo FinanceInvestors grew an appetite for low-cost passive funds after the last financial crisis.
Mutual Funds vs. ETFs: Why Choose One When You Can Use Both?  Kiplinger's Personal FinanceOne tends to be cheaper to own and the other tends to perform better during down markets. That's why I recommend going with a combo strategy.
Shopify Stock, Chipotle, Paycom, Starbucks, McDonald's Just Triggered This Long-Term Sell Rule  Investor's Business DailyShopify stock, Chipotle stock, Paycom stock, Starbucks stock, McDonald's stock, Alteryx stock and Universal Display stock triggered a long-term sell rule.
Mutual fund investors keep faith in stocks despite market rout  LivemintMumbai: Investors in Indian equity mutual funds bought more last month, unfazed by the selloff that saw the nation's $1.9 trillion market log its worst July in 17 ...
How to prepare for a recession  CNBCAre you prepared if a recession hits? Whether or not one is on the horizon, you should take some steps ahead of time to recession-proof your life. “Now is the ...
What India's biggest mutual funds bought and sold in July  LivemintInvestors in Indian equity mutual funds bought more last month, unfazed by the selloff that saw the nation's $1.9 trillion market log its worst July in 17 years.
Goldman Sachs Finds 5 Top Stocks Mutual Funds Have Loaded Up On  24/7 Wall St.To say that mutual fund portfolio managers tend to follow the herd is an incredible understatement, and it always has been. While publicly they sometimes seem ...
Stocks To Watch: Funko, PagSeguro, 3 Other IPO Stocks In Strong Demand  Investor's Business DailyPagSeguro, Funko, DocuSign and these two other IPO stocks to watch are showing strong instututional demand among top money managers.
Is it time to stop investing in equity mutual fund schemes?  Economic TimesIt is difficult to predict the market but many pundits feel it clearly needs some firm signal from the govt.
Retirement Planning That Protects Your $1 Million Savings  Investor's Business DailyYour retirement planning has paid off. You've saved $1 million. Now you're wondering how long $1 million will last in retirement.
Why picking the right mutual fund is key in a tough market  LivemintWhy have mutual fund (MF) returns fallen? Mutual funds primarily invest in equity (stocks) or debt (bonds). On the equity side, mid and small cap MFs have given ...
MF shopping list: Top 30 stocks that fund managers bought & sold in June  MoneycontrolMutual funds increased allocation to private banks, consumer, utilities, technology, NBFCs, retail, metals and PSU bank stocks in June, an ICICIdirect report said.
Top 10 stocks that mutual fund managers bought and sold in March 2019  Moneycontrol.comData for equity flows into mutual funds for March came as a breather after a weak February. An increase in net inflows in equity and income category led to the ...
Invest in reliable outperforming mutual funds: Here are 8 of these  Economic TimesThese funds tend to score well on risk-adjusted metrics and hold dependable stocks in their portfolios.
Should you invest in international mutual funds?  LivemintIf you were to sort all equity mutual funds available for retail investment by their one-year performance, international funds would come on top. The best ...
Consider investing in direct stocks only if you can monitor portfolio proactively  LivemintDirect stocks can be considered if you have the ability to do research to identify the stocks to be bought as well as to be sold.You should be revisiting your ...
Is it time to switch to index mutual funds?  Economic TimesBy Rishabh Parakh It is one of the hottest topics debated these days: is it time for mutual fund investors to switch to passively-managed index funds from their ...
Mutual funds’ exposure to this space at all-time high; should you buy?  Economic TimesMoney managers on Dalal Street continued to shower affection on private banks for the ninth successive month as their exposure hit 19.90 per cent in June, ...
What India's three largest mutual funds bought and sold in June  LivemintInflows into Indian equity mutual funds jumped the most in three months in June.India's top money manager HDFC Mutual Fund held $22 billion in equities.
Mutual funds shooting themselves in the foot?  Economic TimesWhat if banks take a leaf out of Kotak and HDFC Mutual Funds' decision to direct investors to come another day to get their money instead of paying them on the ...
What India's top three mutual funds bought and sold in March  Economic TimesIndias largest money manager held 1.5 trillion rupees in equities.
Equity mutual funds are offering negative returns. What should investors do?  Economic TimesAll equity mutual fund categories have been offering negative average returns in the last one year. Small cap and mid cap schemes were hit the most, with ...
Sensex's rise from 20K to 40K: 5 lessons for equity mutual fund investors  Economic TimesWe look at some critical lessons that equity fund investors learnt during the journey of Sensex reaching 40K.
Yes, stocks are up again. No, recession worries aren't gone  GoDanRiver.comNEW YORK (AP) — The U.S. economy is sending some worrying signals about a possible recession, yet the stock market has gone on a what-me-worry ride ...
Here are a few mutual funds that stocked up on YES Bank in Q4FY19  Business StandardShares of YES Bank tanked 30 per cent in trade on Tuesday, after the bank reported a massive Rs 1,507 crore loss in the fourth quarter of financial year 2018-19 ...
Mutual fund investors showing great appetite for assuming risk: Dhirendra Kumar  Economic TimesOne would have thought that new investors who came into mutual funds will be running away. But they are getting into riskier category of funds and the scale of ...
Flows into mutual funds revive in May as Modi win seems to spur risk demand  LivemintFlows into Indian equity mutual funds in May rebounded from the smallest in 31 months as Prime Minister Narendra Modi's comfortable electoral win spurred ...
Value mutual funds have given good returns over long term but can underperform in short term  Economic TimesOver the years, the benefits of value investing have been espoused by several market gurus and fund managers. Discussions around this investing philosophy ...
Actively-managed large cap mutual funds poised for a comeback  Economic TimesDefying predictions of their imminent irrelevance, some actively-managed large cap mutual fund schemes have bounced back to the top of the return chart.
A Portfolio for All Seasons -  State College NewsYour investment portfolio should be prepared for all seasons. Different sectors of the market perform better than others at different times. Even though they ...
What India's top three mutual funds bought and sold in May  LivemintInflows into Indian equity mutual funds in May rebounded from the smallest in 31 months as Prime Minister Narendra Modi's comfortable electoral win spurred ...
Mutual fund SIPs don't make equity investing risk-free. Here's why  Economic TimesSIPs do reduce the risk of market timing & allow investors to buy more units when their price falls.
A young investor’s guide to mutual funds  Economic TimesMany young investors, who are barely a year or two old in their career, are eager to start investing in mutual funds. ETMutualFunds.com receive many queries on ...
How income from stocks and mutual funds are taxed for an individual  Moneycontrol.comCapital gains from transfer of unlisted share are considered as STCG where period of holding is less than or equal to 24 months, and LTCG when holding period ...
What top mutual funds bought and sold last month  LivemintMumbai: Inflows into Indian equity mutual funds in January were the smallest in two years as heightened market volatility and political uncertainty cooled ...
6 bad money habits that investors should give up  Economic TimesSome habits can exact a heavy toll on your finances. We look at a few common ones that you should give up.
Can mutual funds give multibagger returns like stocks?  Economic TimesStocks can be multibaggers. They can offer extraordinary returns in a very short period. Can mutual funds ever do that? This was a question thrown at Rajeev ...
Index mutual funds see 60% jump in assets in a year as actively managed funds struggle  Economic TimesIndex mutual funds — a category that aims to mimic returns of benchmarks, like Nifty or Sensex — have seen their assets surge 60% over the past one year as ...
How concentrated is your mutual fund portfolio?  LivemintA concentrated portfolio can backfire badly if the fund manager's strategy goes wrong.A portfolio with few stocks can fall sharply if share prices of most stocks in ...
Should investors with very long term horizon always pick small cap mutual funds?  Economic TimesMutual fund investors assume that their risk taking ability goes up if they have really long investment horizon.
These 24 mutual fund schemes have consistently given over 20 per cent returns  Economic TimesMutual fund managers and advisors always ask investors to choose schemes with a consistent performance record. The point is your scheme is supposed to ...
Stay away from stock tips  LivemintIf taming the stock market was easy, everyone would do it.Losing money in market is real and facing volatility is part of the deal.
Mutual funds bet big on these 30 stocks in November; do you own any?  Moneycontrol.comThe Indian equity market rose about 5 percent in November but what was more heartening to see was inflows into mutual funds. Investors pumped Rs 1.4 lakh ...
Should you invest in algorithm-based quant mutual funds?  Economic TimesQuant funds work on a data-driven model that relies on a mix of parameters and algorithms to identify the right stocks at the right time. But can they beat actively ...
Stick to MFs if you lack knowledge on stocks  LivemintWhile equity is surely the way going forward considering your age and the financial goals, how you buy in equity is important.Direct stocks work very well if done ...

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