Friday, April 17, 2015

Why analysts discourage long term...

I was seeing a popular hindi news channel in which folks call and ask stock queries.
So this person calls and here is the conversation:

Caller: Hi, I have bought ICICI bank for long term. Please tell me prospects.
Analyst: Is it long term?

Caller: Yes
Analyst: hmm...so you mean 10-12 months?

Caller: Long term actually
Analyst: ok...so 10-12 months correct?

Caller: (convinced that long term is 10-12 months)....Yes...
Analyst: I would say sell now and buy back if it falls 20 Rs or so. You should get that opportunity

Caller: ok

Huh? You just turned someone who wants to invest long term into a trader.

People to need understand that by continuous selling and buying, only brokerages make a lot of money.
Have the conviction...buy good quality stocks (if you must - I'd rather suggest mutual funds) and hold till you really need money...

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