I was wondering what would have happened if I had never sold the stocks I bought in FY 2016-17.
At that time, I had just graduated from college with little knowledge about stocks, and I made most of my purchases based on recommendations from this forum.
Here are the results:
- Number of companies invested in: 10
- Number of stocks that did not outperform fixed deposit returns: 5/10 (50%)
- Number of stocks that did not outperform small-cap mutual fund returns: 7/10 (70%)
Only three stocks delivered phenomenal returns, while three yielded complete capital loss. Even with equal investment in all trades, the portfolio would only yield a 16.53% return.
Perhaps regularly reviewing and adjusting your portfolio isn’t a bad idea if you’re concentrated on small-cap space. Most investments in the small-cap space are driven by temporary earnings surges, so making timely exits when conditions worsen might not be a bad strategy.
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