My Dear Analyst
I have been a great follower of yours. Each day I used to rise with what you were speaking from Tokyo and went to bed with what you were preaching from New York. I bought when you told me to and sold when you scared me to. During the NASDAQ run I made a few multibaggers but then lost all of it. You would remember how you scolded me for not having applied stop losses. That was after the stocks went below those levels. But I continued to believe in you and your community. I made money in banking, sugar and construction, lost a few here and there. On the whole I did not do better than what I could have managed myself but still I enjoyed each moment of it . In June I lost quite a fortune on your Sterlite and Hindustan Zinc call. That was because the LME prices fell and I was taken off guard. As usual you rebuked me for not having put in stop losses.
During the current carnage when the index fell to 8800 one particular member from your community stormed the TV channels from Hong Kong and preached gloom, boom and doom . The local ones told me to stay away till the dust gets settled. Again I obliged and cut all my long positions converting them for cash. I booked profits in all the counters that I had got in early . This was because you advised me to take the profits home. For the losers you advised that there is no point selling at these levels and as it always happens I listened.
Investors wishing to save themselves from the bloom gloom and doom were advised me to go on a long holiday. I could not go on that holiday since it would have cost money. Another member from your community asked me to keep 30% in cash, a few told me to wait for the US interest rate cues while the others were preparing for a US led global recession and urged gulliable investors like me to buy gold and silver. Theysaid that these would be the saviors.
At an index level of 8800 the largest fund house from the land of the rising sun talked about an index level of 7000 above which they would not invest. Does any one know what they did after making that statement?
When ever I asked you something you were uncomfortable in responding .You called it momentum and I thought that these stocks were for the greedy. But after having suffered because of my shortcomings (in not being able to understand you correctly)
I have a few questions:
1) Doctors, engineers, accountants do pass some examinations before being called experts. They undergo rigorous training and then only they are allowed to advise. Do you along with members of your community undergo the same test before advising millions of fools like me on TV?
2) Do you ever look back and see how many of your recommendations went right and how many went wrong. If so how so if not why not?
3) Do you ever feel guilty either morally or ethically when investors lose money on your recommendations?
4) You have a habit of using vague words like:
- Buy on declines
- Should give you 20% return. Whether the stock is at Rs 700 or Rs 850 you talk of the same 20% returns.
- Cautious optimism.
- Apply strict stop losses - Please name me one person who has made money by applying strict stop losses except the person who sells subscription for such advice.
- Momentum investing - If buying on a break out and selling on stop losses is not momentum investing then what is? Yet you prefer to talk of stocks that you do not understand as momentum investing.
5) Most of the time your analysis is historic. You say this stock has made a 52 week high at so and so and then retraced itself to so and so and now is trading at so and so. You know the introduction that takes 70% of you analysis does not help me. I can see it in the pink papers and that costs Rs 2.00 only.
6) I am tired of hearing words like supports, resistances, 200 day moving averages, Fibonacci, retracements, RSI's etc .
7) Each day you looked at the NASDAQ and the Nikkei and told us where we would go . Over the last 5 years the NASDAQ has gone no where but we have gone up by more then 4 times. Do you remember the critical days when you went wrong?
8) When stocks fell you blamed sentiment when they went up you said liquidity . Why can't you tell us before hand as to what will happen? Otherwise there is no difference between you and me.
Yours Truly,
"The small investor" - A bruised battered and mauled Bull
P.S.: I am not the author of the above post. - Ed
Perhapes you have echoed the voice of milllions of the small investor who have faced the same dilemma like to belive or not to believe the Analyst...
Samir A. Trivedi
Posted by
Anonymous |
11:13 PM
Great Post
Remarkably genuine post . I learned the hard way about 12 years back the price one has to pay if one listens to others in making investments.Better to buy or sell based on conviction.Any information from an analyst is to be only a reference point.
Thanks
Posted by
Anonymous |
11:48 PM
Hi,
My few cents...
I think media made a mockery of Indian Retail Investor during recent fall!. The decisions based on other people's (CNBC etc) "noise" is useless & leads to nowhere. The post also points out to something very useful that timing of market is not possible for most of investors and sticking to stocks in good times or bad is best way to earn money.
Sadly, one retail investor said that "I was rich but watching CNBC continuously ruined me".
Posted by
toughiee |
12:11 AM
Fantastic piece. I think this should be published on moneycontrol.com and other such sites. Also enjoyed the last sentence from your comment. "I was rich but got ruined due to continuously watching CNBC" :-)
Posted by
Anonymous |
11:17 AM
Fabulous. Exactly my sentiments, but paraphrased wonderfully. Analsyts act as the first four letters only.
Posted by
Deepak Shenoy |
5:26 PM
excelente,
Sushil.
Posted by
Anonymous |
9:56 AM
Great post. Reflects the general sentiment of people towards analysts. It is high time that a central body such as NSE alongwith say Mumbai University,start a program for certifying technical analysts who want to become professional.In the USA,they have the highly respected Certified Market Technician program. For more info see www.mta.org
Regards,
Fibo.
www.fibonacci1321.blogspot.com
Posted by
Anonymous |
2:49 PM
Simply Superb.Analyst like Aniruddha Sethi screams whole hog to buy junk in truck loads and there are many fools like me who loose their pants too in the process.When somebody points out their blunders,he is ridiculed by these guys.
Posted by
Anonymous |
1:10 AM
Read Malkiel's 'Random Walk Down Wall St'. Having done in the past pretty much what you have done, this book has brought some sanity back to my investing ways....
Posted by
Anonymous |
10:47 AM