Sorry. If the question is not so relevant to the Thread here.
A recent approach I have taken is to buy a stock even if it has expensive valuation but is a damn good business. I start making SIPs into the stock even it goes down. When the stock reaches to my initial buying price, I sell the shares that I have bought initially at higher valuation. I then deploy that same amount into a different stock with same strategy. This way, my average buying price is less and I don’t miss out the chance of investing in a company which I genuinely like but was optically expensive in the first place. Is this approach good or is there any fundamental flaw to the approach?
The reason I am posting this question in this thread is that, Indian Energy Exchange is a damn good business with around 80% Operating Profit Margin. There are very few businesses in the world which are able to do that. However, with Yearly Sales of Rs.400 Crores and Market Cap of 13,000 Crores, the Price to Sales multiple is at 32 times which is quite expensive. So I am really contemplating to follow the above mentioned approach for IEX.
P.S: I know that the stock I have invested may take some time to reach my initial buying price after a heavy fall but I am ready to bear that opportunity cost. Investing for long term.
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