Q&A: Portfolio Hedging in Stock Selection, Follow My Portfolio Service, Stock Screener

Modified on June 30, 2020

The current article in this series provides responses related to:

 

Hedging by careful stock selection while creating portfolio

Respected Vijay Sir,

I have a hypothetical question for you. In case, if I own two different businesses shares in which one supplies an important chemical which is used in Tyre manufacturing industry and other one is in retreading business which is a substitute for Tyre industry. Then, in such a case there is “conflict of interest” which means one business is actually supporting Tyre industry growth and another one is not supporting the growth of the Tyre industry.

In such a case, can I own both the businesses which are mutually contradicting one other?

Author’s Response:

Hi.

Thanks for writing to me!

Such a scenario leads to two situations:

  1. In case one of the companies does not do well, it is expected that the other company would do well. This is called hedging/risk management.
  2. It can be a win-lose situation, if the overall market size if constant and one company can benefit only at the cost of another company. However, if the market size is increasing, then it might be win-win situation as both the companies would be able to grow their business without eating into each other’s markets.

Hope it clarifies your queries!

All the best for your investing journey!

Regards

Vijay

 

How to know if a stock is overpriced or underpriced?

Hi, Dr V.M (MD in Stocks)

What are the ways through which i can know that whether any share at current market price is overpriced or underpriced?

I have been using your premium calculator from a while but the problem is it doesn’t show that whether a share at current market price is overpriced or underpriced.

I know stocks move & have deep connection with emotions & also operators can do anything in the short term. But I want to know exactly.

Thank You

Author’s Response:

Hi,

Thanks for writing to me!

The excel file [“Stock Analysis Excel Template (compatible with Screener.in)”] provides the P/E ratio at the current prices. I have detailed my approach to decide about the investable P/E ratio of stocks for value investors in the following article:

Read: 3 Principles to Decide the Investable P/E Ratio of Stocks

You may use the guidelines to arrive at the preferred investable P/E range for the stock, which you may like and similarly, you may arrive at the price at which you might be comfortable buying it.

Hope it clarifies your queries!

All the best for your investing journey!

Regards

Vijay

 

Clarifications about the premium service: “Follow My Portfolio” with Latest Buy/Sell Transactions Updates

My experience shows that on an average I add one new stock in my portfolio in a year. This is the pattern since last 3-4 years. However, the number of buy transactions are frequent”

I am confused. First statement says that you add 1 stock (buy 1 stock) in a year. Second statement, says, that buy transactions are frequent. So do you buy once a year (based on history) or do you buy frequently (more than once a year?)

Author’s Response:

Hi,

Thanks for writing to me!

1) “On an average I add one new stock in my portfolio in a year”

refers to adding a new stock to the existing stocks in the portfolio.

2) “the number of buy transactions are frequent”

means that I invest additional money in the existing stocks of the portfolio.

Hope it clarifies. In case of any further doubts, please feel free to contact.

All the best for your investing journey!

Regards,

Vijay

  

Best source of screening companies in Indian stock markets

Dear Dr. Vijay Malik sir,

Namaste, I am searching for a good stock screener for fundamental analysis, I find some screeners but those are showing some mistakes, in my view which is Best stock screener for Indian stocks sir?

Please give your free time sir. Thanks in advance sir.

Regards

Author’s Response:

Hello,

Thanks for writing to me!

I find that screener.in is one of the best sources to screen stocks in Indian markets based on fundamental parameters.

All the best for your investing journey!

Regards,

Vijay

P.S.

 

DISCLAIMER

  • The above discussion is only for educational purpose to help the readers improve their stock analysis skills. It is not a buy/sell/hold recommendation for the discussed stocks.
  • I am registered with SEBI as an Investment Adviser under SEBI (Investment Advisers) Regulations, 2013.
  • Currently, I do not own stocks of the companies mentioned above in my portfolio.

Related Posts:

Get free e-book with 20 Companies Analysis

Free Investing Ebook Case Studies Peaceful Investing
  • Get the e-book: “Case Studies: Applying Peaceful Investing Approach”
  • Learn fundamental analysis by reading 20 case studies in this e-book​
  • Get email updates of our articles

Get email updates of our articles

  • Portfolio returns of 16% against Sensex returns of 8.4%.
  • We identified companies, which were later invested by Sanjay Bakshi, Mohnish Pabrai, PE funds, Mutual Funds
  • See details of stocks in our portfolio
  • Get updates of buy/sell transactions in our portfolio by email

"Peaceful Investing": My Stock Investing Approach

“Peaceful Investing” approach is the result of my more than a decade of experience in equity markets. This approach helped me invest even when I had a full-time corporate job and therefore, could not spare a lot of time for stock analysis.

During my investing journey, I have faced almost all the common challenges of the investors; the biggest one being “scarcity of time”. “Peaceful Investing” approach keeps in mind that an investor will have only limited time for stock analysis. 

The objective of “Peaceful Investing” approach is the selection of such stocks, where once an investor has put in her money, then she may sleep peacefully. Therefore, if later on, the stock prices increase, then the investor is happy as she is now wealthier. On the contrary, if the stock prices decline, even then the investor is happy as she can now buy more quantity of the selected fundamentally good stocks.

Watch Balance Sheet Analysis through a Free Sample Video:

Peaceful Investing Video Series Image
Play Video

Please share your comments here:

1. IMPORTANT: You MUST do a search on Google and on our website to find answer to your query before writing it here. It will save your time as well as our time.

2. All comments are moderated. Your comment will be visible after we approve/reply to it.

Get free e-book with 20 Companies Analysis

Free Investing Ebook Case Studies Peaceful Investing
  • Get the e-book: “Case Studies: Applying Peaceful Investing Approach”
  • Learn fundamental analysis by reading 20 case studies in this e-book​
  • Get email updates of our articles

Get email updates of our articles