The longer you wait, the HOTTER you date🧨

Well, today the market got DIPPER. Many individuals stocks are going down irrationally and that is best way to find “OPPORTUNITIES”.

Stockmarket is filled with irrational investors but that’s how rationale investors make money. Let me Elaborate :

Irrational investors are the one who sell stocks which have no REASON to be sold. When Adani scam was out, the whole broader market was in RED, even the JK group stocks and all banking stocks (even the one that didn’t have any loans with Adani). Another instance was HDFC bank posting bad numbers and all the banking stocks went down on that very day, even after knowing the profit margin issue faced by HDFC was due its merger not muted growth in banking sector.

Not just that, Market is irrational at buying too, during Covid 19 there was fuzz for oxygen related stocks and a company named “Bombay Oxygen Investment Ltd” had rallied crazy, you know why? Just because the company had “oxygen” in its name while its actually an NBFC.

You know who made money in all of these scenarios? the RATIONALE investors. Who bought other banks on Jan 17th, investors who didn’t buy oxygen related stocks and actually invested in value companies at insane discount during covid, investors who didn’t buy Adani stocks in greed but remained disciplined with other companies that work more rationally and ethically.

Investors who make decisions without looking at stock prices and actually just business performance tend to make more rationale decisions in longer time frame and have lesser regrets✔️.

Okay but what is “HOTTER you date”, its “steeper the dip sharper the recovery and higher the returns” - let’s understand the logic :

When stock goes down by 50% and then recovers back its high value it gives 100% returns. This is simple math, but yet many investors forget to apply it when it comes to market. However secret formula of the above math problem is “patience and tracking the business performance of stock” (rather than stock price) and that’s the key for getting multibaggers.

Yes the swings with initial entry had decent potential of 10-20% but with E2 opportunities the swings get HOTTER and discount makes the potential of upside higher✔️

If I give you the choice of earning 20% returns in 2 Quarters for a stock and 100% returns in 4-5 Quarters of the stock, which one will you choose ? - the simpler answer is second option but in reality people chase short term gains and do not keep Patience when it is REQUIRED the MOST.

What is market Rationale behind the ongoing correction ?

➡️ Its multiple trigger points : FIIs pulling back money due to elections and Chinese govt pushing consumption policies to boost their economy.

➡️ Q2 results are not meeting investors expectations and there are signs of slowdown in economy with automobile demand drop and microfinance industry struggling.

Are all these “Recoverable Crisis”? Damn right they are ! So is it rationale to have patience and add quality stocks in this period to get its fruit tomorrow? Yes it is RATIONALE and we are still bullish on India🎯

That being said, we are constantly looking for E2 opportunities and in some cases GROWTHSQUAD may add E3 as well (that would be mega discount stocks). However E3 is only followed by people who have excess capital or else stick with our 15% capital allocation rule and accumulate extra cash to make E3.

This week there can be few E2 announcements as Q2 results keep coming out, enjoy the volatility and keep your focus on business performance in such phases not stock prices🤝📈

Regards,

Team GROWTHSQUAD

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