Jump to content

The Stock Market thread


KnackChap

Recommended Posts

1 hour ago, Mr. Comingle said:

I mean, yeah? 

If you purchase something at a lower price, you will get more money when it increases in value. 

What people say is that it's pretty hard to time your investment because you really don't know if the price truly is bottom and it's not going to fall further and vice versa. You might catch a falling knife or miss out on a rally in a stock which is already at a high but increasing more.

So just forget about all that and invest in the long term growth. 

 

yes, it can fall further but it is still better than peak, right? with MF, you are gonna put that money in that month anyway, why not take even the slightest fall if someone has time?

34 minutes ago, Pacifier said:

Assuming when you say lower NAV, higher NAV, you are talking about the same fund?

 

(1) Unless it is an index fund, I don't think the NAV coming down will be directly proportional to the Market performance.

(2) NAV is calculated every day after market close. So assume you see at 7 PM , the NAV is low, and you add some funds, the NAV applicable for your new investment will not be the value at 7PM but rather the next day's end of day NAV. So if market does well the next day, your NAV might end up being higher than what triggered you to invest in the first place. 

(3) The Idea of SIPs for ME is to just forget about timing the market assuming investment is for long term and the minor NAV differences wouldn't matter much and there is always a case here as well, just like stocks, you cannot predict and time the purchase accurately

 

1.) I am tracking some MFs NAV and it seems it is coming down proportional to market. The recent 3% percent dip in market in a single day made NAV lower

2.) I know, I am speaking if hypothetically some gets the exact NAV he wants. Usually when a dip like 3% happens in a single day, market takes 2-3 days to recover, enough days to put considerable amount as lumpsum in MFs.

3.) Agree, that is actually the idea behind SIPs with MFs. We don't have time to deal with all this, so just put it every month and forget. Again, I am just saying if someone has time and want to play, it is gonna benefit I think.

 

16 minutes ago, El Tigre Chino said:

NAV is the cost per unit of the mutual you're buying into. Think of it as cost of buying one share in the fund. As the value of the assets the fund holds increases the NAV of the fund also goes up, meaning you can redeem the fund at a higher selling price that you purchased it formand vice versa when the value of assets decreases

 

 

Buying at a low cost is always ideal but there are factors that don't make it viable. You can't time the market, in that effort you'll either end up investing at peaks or not investing at all waiting for the dip, which is worse in the long term.

 

SIPs invest at regular intervals and average out the returns from peaks and dips in the long term (<10 year period)

 

What you can do it, during unnatural market dips like the 1500 point one that happened recently, you can do an additional lumpsum investment of either one months worth of SIP installment or fraction of it that you are comfortable with.

 

14 minutes ago, Bird Bird Bird said:

 

Of course. NAV is just like the price of stock for that particular day, except it's not for 1 stock, but a bucket of them, based on weightage.

If you want to time the market, wait till around 2-2:30 pm, and see the bearishness of the market + top 10-15 stocks of the MF you want to invest in. If the heavyweights go down (in the MF), invest before 3 pm. Anything beyond will be allocated next day NAV as MF investment cut off time is 3 pm (payment should be made by they time). 

Thanks for confirmation. Just couldn't find anything in the internet despite searching a lot. Everyone is like - don't choose based on low NAV and all. 

 

Like I said, it takes market at least 2-3 days time to recover itself from a 2-3% correction. The ideal scenario is, keep doing SIP like you normally do but if you have some available funds, then we can always add more funds in our MFs just like we buy on dip. Basically buy the MF NAV dip.

 

So, overall if I have time, I'll wait for some market correction and then invest the same or larger amount which I was  gonna invest anyway or if you have funds, do both.

Edited by dante77
Link to comment
Share on other sites

11 minutes ago, dante77 said:

don't choose based on low NAV and all. 

 

That's different. Don't judge fund A vs B based ok NAV. But for the same fund, you can definitely do lumpsum. 

I never do SIP. Somehow it never sits with me. Always do lumpsum when market is down. Of course, you don't know the bottom, so keep your investment in tranches. For example, if you've to invest 1 lac, you can decide to do 10*10k or 5*20k or 2*50k. 

  • Like 1
Link to comment
Share on other sites

 
That's different. Don't judge fund A vs B based ok NAV. But for the same fund, you can definitely do lumpsum. 
I never do SIP. Somehow it never sits with me. Always do lumpsum when market is down. Of course, you don't know the bottom, so keep your investment in tranches. For example, if you've to invest 1 lac, you can decide to do 10*10k or 5*20k or 2*50k. 
Thinking of same. That is why haven't set a mandate yet. Worst case, do both.
To simplify, you invest in mfs the same way you invest in stocks. Nav = stock price for all intents and purposes. 
Yes. That basically sums up the conversation.

Crazy no 'Finfluencers' ever explained this.
Link to comment
Share on other sites

39 minutes ago, DinJo said:

Actually you cannot time mf nav dates so go blind and invest in 3-4 funds max and also go with direct fund

 

Why can't you time MF NAV dates ? It's literally tracking the stocks in its portfolio. You can make a basket of the high weightage ones (for your MF) on Kite, and predict if the NAV will go up or down. 

Link to comment
Share on other sites

Actually you cannot time mf nav dates so go blind and invest in 3-4 funds max and also go with direct fund
Why not? Market usually corrects itself time to time. Add Funds on that day and then even if market recovers. It won't recover fully. So you'll at least get the same NAV if not more. I experimented this and as you can see from the screenshot I was quite successful.
Link to comment
Share on other sites

2 hours ago, Bird Bird Bird said:

 

Why can't you time MF NAV dates ? It's literally tracking the stocks in its portfolio. You can make a basket of the high weightage ones (for your MF) on Kite, and predict if the NAV will go up or down. 

In the long term the difference between manually tracking it and SIP averaging out is minimal. It's impossible to consistently time the market, at least for a normal retail trader. Consistently being the key factor there.

Link to comment
Share on other sites

6 hours ago, Mr. Comingle said:

You have to realise how hard that is. I have had stocks in my portfolio which just keep going up indefinitely and some which are just falling knives. I mean who predicted nifty will increase by 1.5% today?

Complexity only compounds when tracking a mf (or 4) which could total to dozens of stocks. 

 

4 hours ago, El Tigre Chino said:

In the long term the difference between manually tracking it and SIP averaging out is minimal. It's impossible to consistently time the market, at least for a normal retail trader. Consistently being the key factor there.

 

You can track the ones with high enough weightage to move the NAV. One cannot be a 100% correct all the time, but you can be correct MOST of the time. 

I guess it also depends on the type of MF. Most large cap/blue chip will mostly move with the market. Diversified or small/mid cap can be a bit difficult to follow. 

 

Link to comment
Share on other sites

8 hours ago, Bird Bird Bird said:

 

Why can't you time MF NAV dates ? It's literally tracking the stocks in its portfolio. You can make a basket of the high weightage ones (for your MF) on Kite, and predict if the NAV will go up or down. 

If you look at average of last 10 years sip you will not find any difference just because there are too many events. 

 

If you are really into timing for MF then you should not invest in MF. 

 

Here is the stats which explains https://freefincal.com/best-date-start-mutual-fund-sip/

Link to comment
Share on other sites

1 hour ago, DinJo said:

If you look at average of last 10 years sip you will not find any difference just because there are too many events. 

 

If you are really into timing for MF then you should not invest in MF. 

 

Here is the stats which explains https://freefincal.com/best-date-start-mutual-fund-sip/

 

That article is about "finding the best date for SIP", not SIP vs lumpsum. 

The reason SIP is preferable is because it's convenient, and MF companies bombard you to ensure they lock you in for future investments. 

SIP also helps with investing discipline. 

Lumpsum has the benefit to somewhat time the market - and you can do it on a monthly basis too based on tranching.

Personally, I always prefer lumpsum as that's my style. There's no right or wrong here. 

 

1 hour ago, DinJo said:

Also prediction doesn't work at all. 

 

You can predict NAV movement (up or down) based on stock prices.

Link to comment
Share on other sites

1 hour ago, DinJo said:

since Portfolio disclosure happens on quarterly basis. 

Its monthly.

 

2 hours ago, Bird Bird Bird said:

You can predict NAV movement (up or down) based on stock prices.

If we are in bullish trend, assume the market keeps going up from 1st to 31s of the month with very little to no falls.  Even if it falls on 15th of a month, the NAV might still be higher than what it would have been on 5th (for ex).

But I too agree that you can spread out the monthly allocation to 5K * 4 times month or something like that with cut off dates for sure. i.e. we should definitely invest the first 5K before the 10th of the month etc.  Else, we will end up waiting and who knows the NAV wouldn't come down to the price it was on the 5th of that month!

 

Link to comment
Share on other sites

7 minutes ago, Pacifier said:

Its monthly.

 

If we are in bullish trend, assume the market keeps going up from 1st to 31s of the month with very little to no falls.  Even if it falls on 15th of a month, the NAV might still be higher than what it would have been on 5th (for ex).

But I too agree that you can spread out the monthly allocation to 5K * 4 times month or something like that with cut off dates for sure. i.e. we should definitely invest the first 5K before the 10th of the month etc.  Else, we will end up waiting and who knows the NAV wouldn't come down to the price it was on the 5th of that month!

 

 

Yeah. I agree. Maybe invest 4 times a month, once a week. Or twice every fortnight. 

Nothing right or wrong. Wealth will anyway be created in long term. 

Link to comment
Share on other sites

2 minutes ago, Bird Bird Bird said:

Nothing right or wrong. Wealth will anyway be created in long term. 

Agree. What works for you is fine as long as you're putting the money in.

 

From my personal experience, the first two years I realised that in my attempts to time the market with just lumpsum and I'd end up not investing, waiting it out for a dip and then ending up putting in money at a higher cost.

 

Currently a hybrid system of regular monthly investments + additional lumpsums during dips works a lot better for me, returns wise.

Link to comment
Share on other sites

The difference between investing all of your money at the peak of a bull run vs at the bottom of a bear run will be minimal and negligible, 10 years down the line.

 

So maintain SIPs in tranches i.e. 4 times a month.

Keep money aside for lumpsum investment when the market dips.

 

As for tracking the NAV, possible but with extrapolation. You can track the basket of stocks but you can't track the error due inflow and outflow of investments on a daily basis.

Should be able to get a reasonable estimate nonetheless.

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Restore formatting

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

  • Recently Browsing   0 members

    No registered users viewing this page.

×
×
  • Create New...