BLUNT DECISION MAKING IS AN ART NOT SCIENCE

The question of selling Cummins (500480.bo) frequented my mind all day long, and my friend told me to consider and search the followings for the company and not to regret in future
1. EPS
2. P/E
3. PEG
4. Operating profit margin
5. Net profit margin
6. ROE

I heard those terms before like most RSHI. But hardly have the time and resource to scout them for all the stocks I have in mind.

I have a “nine to five” job; it is a modest eleven hours per day including the journey time. I don’t have the confidence to give up my present job and start “stock”ing. Don’t have access to that kind of money too.

I don’t want to enroll myself to some SMS and Tips for Money Experts. I have seen them in performance, laundering money and giving peanuts in returns at best.

Stock price is a number that carries many information about the future prospect of a company. And also emotion plays a major role, if it takes over, the stock price and its valuations lose touch, the stock is then either over valued or undervalued. However the stock will correct itself accordingly in time. These are the thumb rule of the market.

But I am a very small investor. I cannot wait for the stock to correct itself aligning with its intrinsic value and that kind of blah-blah-blahs. I will sell the stock Cummins and book profit. I should not wail if the stock sees new highs. A bird in hand is better than two in bush.

Then where I will invest the proceeds? IFCI (ifci.ns) is not a bad candidate with a very low P/E and fantastic volume to boot. It is a momentum stock at present, already made a run. I will be aggressive and buy more if the stock corrects and hold it for about a month or two. Target: 20-30% growth of my small capital.

My second investment was HCL Technology (hcltech.ns), it seems the stock is not going anywhere, may be for the regained strength of Rupee. I have respect to the capability of Mr. Shiv Nadar. May be some good news in a week or so will push the stock up.