Businesses with 'MOAT'. Investment Strategy & Discussions

Q&A: Questions & Answers Portfolio Q&A
22

Sorry to say this, but your idea of not mixing FA with TA is not correct, because profit booking is real, and opportunity cost is real.

If I am invested in a stock and in profits, and if the price is falling continuously, charts help in understanding the fall visually, they also provide the mathematical angle. And if the fall is continuous, along with volume, and other indicators, I would book profits, as they are evaporating right in front my eyes. And I can invest later if it is a good investment.

And even if a company is good fundamentally, it will stay in business for the next 20 years too, with honest, able and experienced management at the helm, but if the price is already in consolidation, it may remain consolidated for a few quarters. So despite my knowledge of fundamentals, I will not invest fully, I may invest some, take a position and observe the price movement, but not invest full.

When we say fundamentals, we are talking about a company, a business, but when we say charts, we are talking about a stock. That is the difference, they are in a sense different things. Not every good business is a good stock, not every good stock is a good business.

To have some knowledge about charts certainly helps, it has helped a person like me who does not even know fundamentals at the beginning of my journey, but now I am glad that I have learnt some charting, and I could do some timely profit bookings, which I would not have known if not for the charts.

Being patient is certainly helpful, if one has great conviction, but to be not frustrated for years, when the price does not go anywhere is not easy. More so, when the invested capital is substantial. Charts help here.

So yes, I will say, it really helps, and as it is helpful to me, it is helpful to everyone, just like water.

3 Likes
23

Well, everyone has their philosophy. All best.

24

Hi Anna,

In my mother tongue Kannada ‘Anna’ is elder brother and I call my father Anna :smile: Nice Name.
Thanks for your observation and comment!
As explained in my earlier posts, Am learning methods to sail through.

As most of the newbies, I have started with the charts with the expectations that market behaves in a pattern; which we can know by drawing a trend lines, ziz zag patterns, support-resistance, Fibonacci, Elliott waves etc etc , Market may behave in some pattern; but no one knows what that pattern is or as they say it is a complex continually evolving pattern, which I started believing now.

I agree with @ChaitanyaC here.

But, As of now, I work with 90% fundamental (Buying, position sizing, selling) and 10% Technical (It feels good to add position in stocks with conviction, when they make “New All time High” or reach a medium term support because Mr.Market is in bad mood)

Just to clarify, I have not sold any of my holdings in last 6 months correction, will think of selling them based on fundamentals when market is in good mood, may be after 6 months.

Hope this explains the thought process on mixing Fundamentals and Technicals.
Cheers.

1 Like
25

Hi Anand,

I have worked in Bangalore for a bit and been involved with stock market since 1990’s. So seen a bit in the process.

Various frameworks are useful for different purposes. I am essentially a long term investor working on fundamental of company/business. While market has its own logic/illogical in the short term, over the long term fundamentals will play out. Another lesson is that it is impossible to consistently time the market. Remember that and you will do great.

4 Likes