Covid has become a bad memory, thank god for it. In investing, we hear – Buy when there is blood on the street and to be greedy when others are fearful. Covid was a perfect example to evaluate what you actually did
Three years have passed and I thought it will be a good exercise to see if it’s easy to do the right thing when there is madness all around
A glimpse of the madness
Nifty dived close to 40% from 11,000 in the space of days, this is such a rare event that it’s difficult to think about it let alone stomach it
What was one of my first decisions – I need to protect profit in one of my big profit positions Suven Life Sciences, My rationale was
Life science component though close to Mr. Jasti’s heart, it is pure play speculative bet and tough to put a valuation figure while the pharmaceuticals component is something the management may get rid off and then at ~INR 4500 crore market cap was richly valued
In hindsight this was not a great move as Suven Pharma went on to become stronger and stronger, I course-corrected and later recreated this position in my portfolio in late 2020 at a higher market cap
I also got rid of a non-meaningful small position (5 Paisa) and did one of the best trades of my career price-wise (regret not quantity-wise) in Yes Bank
markets were continuing to fall fear was building, but I had to stop to focus on a very important event in my life – the birth of my son on 19.03.2020, partially this was the reason to square off Yes Bank as I didn’t want to carry the trade to the hospital 🙂
Dad duties were done markets started recovering with the hope that the world would survive, my theory was that I need buy as this opportunity might not come again so over the next 2-3 months I partially booked my profits in some big positions (PIIND and DIVIS) but largely I put whatever cash I had into markets in what I thought were best bargains
overall I rate that I was able to overcome fear and actually was able to live by what I believed, my decision on Suven wasn’t great but overall I am happy.
Come 2022 and 2023 some of these buys have become the best profit positions in my investing journey
Get a pen paper and do this analysis for yourself, By doing this you will learn if you are a fit for the stock market or not
Happy Investing