Cera Sanitaryware and Symphony Coolers.

Hi All,

Any idea on why these two stocks are nose diving, any thing wrong with these counters, 6 months back every one were gung-ho about these counters. I am totally getting confused in indian stock mkt whom to believe and on what basis should I buy a stock. Most of the stock which were rising like starts are fallen now like cera/symphony/rssoftware/noidatoll/hawkins, next turn is I think of kitex/page industries/eicher.

 

Ups and down are common for any stock. No stock can go in same direction. Sometimes market gets enthusiastic and value companies richly. But over the long period of time stocks allign to their intrinsic value. Do your own research first and while researching the company don't look at it's stock price first instead look at its fundamentals and numbers that it has posted. After you are yourself assured that the stock is worthy of your investment you should look at the price and try to get it as cheaply as possible or atleast at some reasonable value which would allow you to make money in the future. This is popularly referred to as margin of safety. Peter Lynch has famously illustrated this concept in his book by giving an example of a bridge. Suppose if you want to build a bridge that would carry 30 tons of weight you should build a bridge to support atleast 100 tons of weight.