trading tips: Hi, Sensex and Nifty are at their all-time high, and investors are confused to book profits or stay invested So we will today talk about this in the article. let us start
trading tips 1. ANALYZE AND CATEGORIZE
Firstly, you should analyze and categorize all the stocks in your portfolio and should see them in 2 categories . Long-term and Short-term. Long-term is the stock in which you have invested after research and expect a long-term growth potential.
And to sell these types of shares on market highs would not be good for you. Because these ups and downs are temporary But your long-term wealth creation is dependent on these stocks only.
To sell a stock that has shown good growth in business and will just because it has given you a decent profit. Wouldn’t that be beneficial for you?
The second category is the short-term stocks. Which you bought in momentum, from a tip, or from the news You should access these stocks, and even after research, you don’t get clarity on their long-term potential. You can book small profits in these stocks
Many people say that as soon as they sold the stock, the share price went up. To not have FOMO, fear of missing out, don’t sell all your stocks at once. You can hold some stocks from your overall portfolio
2.DIVERSIFICATION AND ASSET ALLOCATION
The second point is diversification and asset allocation. You can check your portfolio on the basis of industry diversification. And see that a major portion of your portfolio is into one or two main industries. And if so, you can sector-wise diversify your portfolio. Meaning if any sector sees a fall, the other can offset it for you. And after this, you should analyze how much is your portfolio diversified. Is all your portfolio is invested into stocks, if so you can book some profits from stocks and invest in gold or international equity and allocate in different assets? By doing this you will reduce your risk and will be able to attain exposure to other avenues
3. SENSEX AND NIFTY ARE AT ALL-TIME HIGHS
The third is that even if Sensex and Nifty are at all-time highs. It doesn’t mean that you wouldn’t find undervalued stocks. When we say undervalued, many people think that a low PE which is below the industry average is undervalued. This is not mandatory, some of the companies have low PE due to poor past performance. Or these companies have some red flags. Some stocks fall due to some temporary over-reaction. Or bad news and this can be a good buying opportunity, and to know about them, you can research those industries in which you are comfortable (trading tips)
For example, if someone works in the banking industry can research about the same and can get to know undervalued stocks in the industry. So these were the pointers you can keep in mind when the markets are at their all-time highs. To get these interesting updates, download the Groww App
This article is only for educational purpose, it is not a buying/selling recommendation
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