How to figure out the correct time to enter markets after steep correction

Indian markets have been through a major shakeout since the start of September 2018. The NIFTY has lost approximately 10.5% and the SENSEX is trading 10% lower when compared with the levels at the beginning of September. A few negative macro factors, including rising oil prices and the rupee falling to an all-time low, caused the Indian stocks to shed gains accumulated in the previous three to four months. Continue reading “How to figure out the correct time to enter markets after steep correction”

What factors should I consider in building a watch list of stocks?

A great way to find worthy watch-list choices is to focus on stocks that hold up well during the bear market. While few stocks have broken out and notched new highs without correcting, a decent number have formed sound bases or hovered near a prior pivot point. Screening for stocks with Relative Price Strength Ratings of 80 or higher helps you find these candidates. You also want your stocks to hail from leading groups, so insist on solid Industry Group Relative Strength Ratings. Fundamental strength should also play a vital role. Remember, you’re looking for the very best the market has to offer. That means finding stocks with robust quarterly sales and profit growth 25% or more is a good baseline. Try to screen for stocks with EPS rating of 80 or higher. Insist on strong institutional support in the form of an A or B Accumulation/Distribution Rating and rising fund ownership. It is vitally important to remember that even the best-looking stock will likely fail until the market rights itself and launches a new bull phase.