An amazing Mid Cap Large cap insight

There has always been a frenzy in the stock market around multibaggers.

You will often come across stories that go like this - “Oh I bought this stock when it was trading around Rs 25 and today it is trading at Rs 250”. “I made a handsome 10x on this stock”

But, people seldom discuss negative outcomes or stories of their failure. Aspects like risk mitigation, position sizing & opportunity cost often take a back seat paving way for cooler discussions around multibagger stocks.

Consider the case of “VEDL”. After making a high of Rs 484, the stock has virtually remained flat for 14 long years. One may wonder whether it is even possible to successfully navigate through the troubled waters of a choppy stock like this one but that is where the beauty of momentum lies.

VEDL entered Mi NNF 10 back in Apr 2021 at a time when most might wonder “Why now”. The stock may not have gone on to become a multibagger for the portfolio but just the fact that a rule based approach could successfully manoeuvre through a stock like this without having to face a loss & instead to come out with a reasonable gain of 50% speaks volumes about the ability of momentum investing to keep you calm and composed at all times without having to worry about the outcomes too much.

So multibagger is not the only thing that sounds cool,

Identifying and extracting momentum in a stock that has remained stagnant for 14 years is also a story worthy of a discussion.

An amazing Mid Cap Large cap insight

In this insightful analysis, we delve into the comparative performance of CNX 200 and Nifty over the past two decades. Surprisingly, despite slight deviations in certain years, both indices have delivered nearly identical results. This raises an intriguing question: why do these two indices, comprising mostly Nifty stocks, yield such similar returns?

Adding another layer to the analysis, let’s consider Nifty Junior, the 51st to 200th stocks in the index. Remarkably, Nifty Junior has outperformed both Nifty and CNX 200 by a significant margin, boasting over 1700% growth compared to around 1000-1100% for the other two indices. This substantial performance gap sheds light on the dynamics within the Nifty universe.. . . .

Reading Time : 4 Minutes

Case Study on Adobe : Test of patience or inefficient use of capital

Adobe Inc., the powerhouse behind software like Photoshop and Adobe Reader, has captivated users for years. Its journey in the stock market reflects this dynamism, marked by significant highs and lows. Since 2001, the stock has experienced a rollercoaster ride, reaching soaring heights and plunging depths.

For investors, Adobe’s trajectory poses a significant challenge. Imagine waiting 14 long years for a stock to surpass its previous high. The patience required is immense, and many would find it difficult to hold onto their investment for so long. This prolonged period of stagnation can test even the most patient investor’s resolve. . . . .

Reading Time : 3 Minutes

WeekendInvesting Daily Bytes

A very good bounce from the lower end of this channel, which we saw on Friday, was continued, although most of the gain for the day was done at the open itself. So the market opened with a huge gap up, retraced a bit, but then closed at that open itself. From a perspective of this uptrend, we have retraced more than half of what we fell. So from that perspective, I think it’s a very, very positive sign that the market has stabilized here and has closed at two day high on the chart. So it looks pretty good now. Again, the bottom of the channel will remain the support.

Reading Time : 6 Minutes