Corona Virus Scare in Markets?, Opportunities are often born in a fog of Uncertainty.

JOIN STRATEGIC ALPHA COMMUNITY

More than 3600+ People are a part of the tribe. Sign Up now to Receive, Newsletters, Blogs, Webinar Invite, Wisdom Posts, Potential Multibagger Ideas.

March 25, 2020

l

Strategic Alpha

Corona

Dear Followers,

The news of the coronavirus spreading outside China’s Hubei province has turned out to be that catalyst. Stocks have sold off. The coronavirus is deadly and the headlines from China about frontline medical workers becoming victims are heartbreaking. Nevertheless, the job of a prudent investor is not to speculate about short-term events.

The global economy has always recovered from calamities such as the tech bubble, the Recession, various pandemics, and so on. Let’s have a check on how BSE Sensex Fared 6 Months after various pandemics in the past. Below are % Gains/ Losses on the BSE Sensex after Various pandemics that hit.

Corona Visrus

    Looking at the current situation, stocks that have sound fundamentals having below attributes perform better than the index itself. This scare of the coronavirus is giving a good time to build a long term investment basket.

Attributes for a good long term stock:-

  1. Low debt or debt-free companies.
  2. Sound business models.
  3. High promoter holding.
  4. Very low or no pledged shares
  5. Very old businesses at least 15 years old.
  6. Easy to understand businesses.
  7. Good management pedigree and trustworthy promotors
  8. Growing sales, growing profits
  9. Stocks near or below intrinsic values
  10. Those stock which is cyclical will benefit from business upcycle and commodity upcycle.
  11. Promotor increasing stakes.
  12. High ROE, high ROCE
  13. Companies benefitting from operating leverage in the future due to underutilized capacity currently.
  14. Low PEG ratio
  15. High-interest coverage.
  16.  High competitive advantage due to long-standing relationships with their customers, logistical advantages, lowest cost manufacturer.
  17. Bargaining power with their suppliers
  18. Low on receivable days.
  19. High entry barriers due to location advantage, huge capital investments to replace their capacities as a competitor.
  20. Depressed earnings now in cyclical stocks but as debt-free companies, these will be least affected compared to competitors but bound to do best in the industry as the tide turns. Those not debt-free, but has a big debt should provide confidence about the repayment.
  21. Old school, old economy stocks with no replacements for their products seen in near-decade.
  22. Promotors experience in the same business of more than a decade.
  23. Proven track record. Current Scare is giving an opportunity to buy, it’s time to be greedy when other’s are fearful. I believe 6 months from now, everyone will forget what coronavirus was?

uncertinity

TIME TO BUILD VISION VISION 2025 STOCK BASKET

Join Me On My Telegram Channel Where I Share Much More Value Adding Knowledge Of Investing/ Trading: Click Here

Also, Don’t Forget To Follow Us On Our Social Media Accounts:

Facebook: https://www.facebook.com/strategicalpha/

Instagram: https://www.instagram.com/strategicalpha/

Twitter: https://twitter.com/strategic_alpha?lang=en

YouTube: https://bit.ly/2IIqztO

Very important note: The objective of this blog is to share knowledge and info about multi-bagger ideas/opportunities. Neither is this trading website nor an analyst website nor a Buy/Sell call website. For stock market success, always do your homework, own analysis, and make your own decisions.

For Mentorship Enquiry Please Fill This Form: https://forms.gle/pT9PyQJbbw1fV8qb8

The author of the blog Mr.Suyog Dhavan is a Full-time Investor / Value Trader and Value investing/Trading Mentor. His style of Investing is inspired by Mohnish Pabrai, Peter Lynch, and Porinju Veliath. He is the founder of Strategic Alpha Wealth, A Premier stock market mentorship firm with a mission to touch the lives of 1Lakh people through its mentorship program.

0 Comments

Mentees

Learn more about us

Strategic Alpha is on a mission to change the wealth lives of over 1 Lakh people through mentorship based fortune creating investing model.

We Believe wealth is the ability to fully experience life, so we are on the mission to give you this experience of life.

Monthly Blog Readers

%d bloggers like this: