Blood on Dalal Street!

Today’s market fall was fantastic- Nifty and Sensex are down 8% from their highs, while most broader indices are in correction zone- down 10% or more. Well, instead of explaining why it happened, isn’t it most of you wanted it to happen!

There has been so much hullabaloo about markets making new highs everyday and why this is decoupled from reality and the valuations are too stretched that I believe there should be community gatherings to celebrate this fall. This, however is not the case. People who were clamoring for a dip to buy are now worried if the new South African variant is going to lead us to another bear market. My words for them- bullshit. Please ignore.

I’ve said this before and I’ll repeat it again- India is at the beginning of a multi year bul run and all maga runs are interrupted by brutal, sharp and sudden corrections and this my friend, is exactly one of them. I’d quote from Reminiscence of a Stock Operator when all that the old fellow said in similar times- “this is a Bull Market.” If you’re not looking to buy more or atleast hold on to your position, you’re going to regret it pretty badly.

Sensex may go down from 62k to 55k but it three five seven years from now, it’s more likely to be over 100000 than 40k, isn’t this the perfect buying opportunity? In markets, 99% of the time, optimists win. You do make occasional killings while shorting but none of us is Soros shorting the Pound or Burry shorting the CDS bubble.

Now I’ll come to what I think when my portfolio falls 5% in a day- nothing! I’m a firm believer in what I’ve said and most positions I own are company specific. Well BSE share price may fall 10% a day but do you think the company didn’t make any money while there was massive volume to short? Unless you’ve a clear vision of why you own what you own, you’ll get out at the bottom and regret as it rebounds ans enter at the top. Buy High, Sell Low that is!

I know some of you who are not making money in this market who’s portfolio is either break even or below cost and that’s a shame. If you’re losing money when everyone is double, you should close your trading account and just buy index funds and sit quietly. You’ll do much better.

Also, here’s a cue- Delhi recently had its annual pollution shutdown. So there are three possibilities from here. In ten years, pollution will only grow and most people will suffer miserably and develop life threatening diseases. Or, Delhi will be shut from Diwali to New Year completely to control pollution. Or, people will buy electric vehicles because it is non-polluting. If you’re of the opinion that third option is most likely, look around and see who’s smiling when there’s massive runway for growth for electric cars? Hello Tata!