Bottom Picking

airborne · 1 Bottom Picking Sun Feb 19, 2012 10:12 pm

airborne

Equity Analytic

Posts : 20
Equity Stars : 4569
Reputation : 3
Join date : 2011-11-27

Most of us will never be able to predict the market bottom. Having traded for some time I'd like to share a few signs and contrarian indicators suggesting a bottom is near, or its a good time to buy.
1. Your broker calls you at 10am and has a one hour chat with you about nothing important.
2. Your big time trader colleague / Neighbour does not want to talk to you about stocks.
3. Most of your trader buddies say they've sold out their stocks long ago.
4. People who know you're into shares brag they get better returns keeping their money in FDs.
5. People pity you, when they know you're a share trader...
Hope some of you seniors would be able to share some of your bottom picking indicators.
Thanks

sriranga · 2 Re: Bottom Picking Sun Feb 19, 2012 10:24 pm

sriranga

Co-Admin

Posts : 6822
Equity Stars : 23022
Reputation : 2855
Join date : 2011-02-01
Location : London

http://forum.srilankaequity.com/t15828-10-signs-of-a-stock-market-bottom

FXX · 3 Re: Bottom Picking Sun Feb 19, 2012 10:27 pm

FXX

Senior Manager - Equity Analytics

Posts : 556
Equity Stars : 5427
Reputation : 35
Join date : 2011-05-03
Location : The Miracle of Asia

No 1 happen to me entire last week Razz

gada · 4 Re: Bottom Picking Mon Feb 20, 2012 7:54 am

gada

Stock Analytic

Posts : 12
Equity Stars : 4631
Reputation : 3
Join date : 2011-09-12

No 1 happened Very Happy

Others were happening quite some time ago Laughing

Universalgoal · 5 Re: Bottom Picking Mon Feb 20, 2012 10:27 am

Universalgoal

Assistant Vice President - Equity Analytics

Posts : 859
Equity Stars : 6653
Reputation : 38
Join date : 2011-09-15
Age : 42
Location : Universe

No 5 Happened Sad

hunter · 6 Re: Bottom Picking Mon Feb 20, 2012 10:28 am

hunter

Moderator

Posts : 786
Equity Stars : 6927
Reputation : 114
Join date : 2011-04-27

It is important to understand about the bottom. But,
Bottom picking looks too risky to me.
Trending is more reliable.

cseguide · 7 Re: Bottom Picking Mon Feb 20, 2012 11:32 am

cseguide

Vice President - Equity Analytics

Posts : 1332
Equity Stars : 6366
Reputation : 56
Join date : 2011-04-20

hunter wrote:It is important to understand about the bottom. But,
Bottom picking looks too risky to me.
Trending is more reliable.

what you mean ''trending" can you please explain?

rijayasooriya · 8 Re: Bottom Picking Mon Feb 20, 2012 1:01 pm

rijayasooriya

Senior Vice President - Equity Analytics

Posts : 1827
Equity Stars : 6801
Reputation : 134
Join date : 2011-05-25
Location : Matara

airborne wrote:Most of us will never be able to predict the market bottom. Having traded for some time I'd like to share a few signs and contrarian indicators suggesting a bottom is near, or its a good time to buy.
1. Your broker calls you at 10am and has a one hour chat with you about nothing important.
2. Your big time trader colleague / Neighbour does not want to talk to you about stocks.
3. Most of your trader buddies say they've sold out their stocks long ago.
4. People who know you're into shares brag they get better returns keeping their money in FDs.
5. People pity you, when they know you're a share trader...
Hope some of you seniors would be able to share some of your bottom picking indicators.
Thanks

In summary this is called CONTRARY OPINION.

mra · 9 Re: Bottom Picking Mon Feb 20, 2012 1:11 pm

mra

Manager - Equity Analytics

Posts : 271
Equity Stars : 5095
Reputation : 7
Join date : 2011-06-22
Location : Colombo

one of the moderator's face so disgusting to look. for the sake of all members I wud appreciate if he can select one to look cool charm from billions of available avatar in the net. it looks he is on a big lost, still don't show that frustration for others.

rijayasooriya · 10 Re: Bottom Picking Mon Feb 20, 2012 1:41 pm

rijayasooriya

Senior Vice President - Equity Analytics

Posts : 1827
Equity Stars : 6801
Reputation : 134
Join date : 2011-05-25
Location : Matara

mra wrote:one of the moderator's face so disgusting to look. for the sake of all members I wud appreciate if he can select one to look cool charm from billions of available avatar in the net. it looks he is on a big lost, still don't show that frustration for others.

Thanks for ur suggestion Wink

.I like to keep that as it is the current profile picture of CSE ,Of course it is not my face.

Anyway when I see ur profile picture I remember a nice little story.

ඉස්සර කාලේ සිත්තර ගුරුණ්ණාණ්සේ කෙනෙක් පන්සලක බිත්තියේ සිතුවම් කර-කර ඉන්නකොට පන්සලේ ලොකු හමුදුරුවන්, අල්ලපු ගමේ පන්සලේ ලස්සන හමුදුරුවරයකුගේ පිංතූරයක් ගෙනල්ලා සිත්තර ගුරාට දීලා කියුවලු,
"ගුරුණ්ණාණ්සේ ඔය පිංතූරේ ඉන්න හාමුදුරුවො ලස්සනට සිතුවම් කරලා යටින් මගේ නම ලියාපන්" කියලා.ඒ පාර ගුරා ඇහුවලු ,
"ඇයි හමුදුරුවනේ ඒ අල්ලපු පන්සලේ ඉන්න හමුදුරුවන්ගේ පිංතූරයක් නේ" කියලා.
ඒ පාර ලොකු හාමුදුරුවො කියුවලු,
"බොලං ගුරෝ උඹට සල්ලි දෙන්නෙත් මම නම් උඹ අඳින්නෙත් මගේ පන්සලේ නම් පණ්ඩිතයා නොවී මම කියන විදියට වැඩේ කරපන්" කියලා.

airborne · 11 Re: Bottom Picking Mon Feb 20, 2012 1:57 pm

airborne

Equity Analytic

Posts : 20
Equity Stars : 4569
Reputation : 3
Join date : 2011-11-27

Thanks, Sriranga.
Fxx, Gada and Universalgoal - It may be a good time to buy.. Very Happy

Although I have no idea when the market will go up.

Any more contrarian ideas?

Slstock · 12 Re: Bottom Picking Mon Feb 20, 2012 2:06 pm

Slstock

Director - Equity Analytics

Posts : 6610
Equity Stars : 13364
Reputation : 1158
Join date : 2011-01-22

airborne wrote:Thanks, Sriranga.
Fxx, Gada and Universalgoal - It may be a good time to buy..
Although I have no idea when the market will go up.

Any more contrarian ideas?

When forum participation and number of posts gets lesser and lesser , it is sign of bear improving . At one point it will be minimal. Thats is the bottom. I am just kidding.

On a serious note :
Good time to buy will be dependant on one's investment plan and holding power. Many I see in the forum are short term players trying to pick bottoms and optimize profits on market cycles.

Also good to note that
Once the market was overvalued with PE of 20+. A big market correction was needed and it happened. Along with mistakes SEC made we have to admit they did some good to take some steps to prevent a bubble( we discussed the good and the bad they did before. Let not argue again).

How much more correction is needed is the question? But as I asked before is CSE that bad to deserve a further drastic drop?

Yes there is a temporary volatility in Sri lanka due to balance of payment , fuel hike , currency devaluation, expropriation etc etc. So in panic people can bring market down more. But in reality we have had about a ASI 35 % drop from the top. Market PEs considering forward year end earnings should be around 10-11 now( to be calculated). Also most companies have corrected sometimes over 2010 July prices. Most of the overvalued junk + even good fundamentals have come down to earth ( sometime more than needed for a fair valuation) . Are all our companies performing that bad? I agree there are a still few high cap and some others counters trading at more than their fair value ( CARS, BUKI are main culprits. Sorry CARS/BUKI lovers but look at their valuations with regarding to present earnings) If these get individually corrected the market PE will be even lesser.

I do not see why foreigners should not find market more and more attractive in the coming months. Right now to me market is getting close to be fairly valued. We already see foreigners slowly entering again .
Thats should give us some thing to think about. I read Indian Stock market has also seen considerable inflows last week . But due to world and (short term ) local economic issues some might still feel they should take back seat to wait for an even better time to enter. The "safe havens" in rising deposit and bond interest rates is not helping CSE either.

I am in no way trying to predict market behavior in short term. It can drop further if people panic and rules maker make bad policy decisions. Also it can rise due to sudden cash influxes. But my hope is that market remains range bound around 5000-5400 for some time to stabilize. It is better to stabilize than huge spikes or huge plunges both of which can be detrimental for a stable market.

Tiger · 13 Re: Bottom Picking Mon Feb 20, 2012 2:12 pm

Tiger

Assistant Vice President - Equity Analytics

Posts : 700
Equity Stars : 5517
Reputation : 85
Join date : 2011-06-03
Location : Dubai

Thanks for the timely article. Whether to increase the investment in the current market or not will purely dependent of the ability of the investor to absorb more losses should there be any, or does he has capacity to exploit the situation should the market fall further. If the answer is NO, then don't buy now and hold on to your cash. Wait for the clear reversal of the trend and then ride on the trend.

In this way one may loose the bottom picking, but could avoid the burning out and you may still be with a chance to make profit.

Just my opinion.

mra · 14 Re: Bottom Picking Mon Feb 20, 2012 2:24 pm

mra

Manager - Equity Analytics

Posts : 271
Equity Stars : 5095
Reputation : 7
Join date : 2011-06-22
Location : Colombo

rijayasooriya wrote:

mra wrote:one of the moderator's face so disgusting to look. for the sake of all members I wud appreciate if he can select one to look cool charm from billions of available avatar in the net. it looks he is on a big lost, still don't show that frustration for others.

Thanks for ur suggestion .I like to keep that as it is the current profile picture of CSE ,Of course it is not my face.

Anyway when I see ur profile picture I remember a nice little story.

ඉස්සර කාලේ සිත්තර ගුරුණ්ණාණ්සේ කෙනෙක් පන්සලක බිත්තියේ සිතුවම් කර-කර ඉන්නකොට පන්සලේ ලොකු හමුදුරුවන්, අල්ලපු ගමේ පන්සලේ ලස්සන හමුදුරුවරයකුගේ පිංතූරයක් ගෙනල්ලා සිත්තර ගුරාට දීලා කියුවලු,
"ගුරුණ්ණාණ්සේ ඔය පිංතූරේ ඉන්න හාමුදුරුවො ලස්සනට සිතුවම් කරලා යටින් මගේ නම ලියාපන්" කියලා.ඒ පාර ගුරා ඇහුවලු ,
"ඇයි හමුදුරුවනේ ඒ අල්ලපු පන්සලේ ඉන්න හමුදුරුවන්ගේ පිංතූරයක් නේ" කියලා.
ඒ පාර ලොකු හාමුදුරුවො කියුවලු,
"බොලං ගුරෝ උඹට සල්ලි දෙන්නෙත් මම නම් උඹ අඳින්නෙත් මගේ පන්සලේ නම් පණ්ඩිතයා නොවී මම කියන විදියට වැඩේ කරපන්" කියලා.

CSE itself now a disgusting name. what made you to select from CSE when there are millions of other nature picture friend.? I have red few other threads also from other members about your profile picture. arguing about profile pictures are childish. I have shown a valid reason abt yours. anyway I can not force you, its a just friendly request to make you more handsome. since no share mkt today I have time to comment abt it..do whats best for u.. Very Happy

Redbulls · 15 Re: Bottom Picking Mon Feb 20, 2012 3:21 pm

Redbulls

Director - Equity Analytics

Posts : 6053
Equity Stars : 16057
Reputation : 770
Join date : 2012-02-14

I read this part in a article some times back.
May be helpful.

Instead of picking the exact bottom it may be beneficial to wait for the stock to stabilize and form an uptrend again before buying. This may lose the investor the opportunity to get in when the prices are at their lowest but the benefits of profiting more often will outweigh the potential profit you may have missed out on.

airborne · 16 Re: Bottom Picking Mon Feb 20, 2012 6:49 pm

airborne

Equity Analytic

Posts : 20
Equity Stars : 4569
Reputation : 3
Join date : 2011-11-27

Sistock said

When forum participation and number of posts gets lesser and lesser , it is sign of bear improving . At one point it will be minimal. Thats is the bottom. I am just kidding.

Totally agree with you. Another good sign some time back was when you visited the brokerages there would be no one in the public galleries.

Another one that got me thinking once, was when I called a broker during a bear market was when he asked me do I want to buy a car. He had left his job and become a car salesman. Another wanted to sell me Insurance. Laughing

LateTackle · 17 Re: Bottom Picking Wed Feb 22, 2012 8:37 am

LateTackle

Senior Equity Analytic

Posts : 69
Equity Stars : 4791
Reputation : 3
Join date : 2011-06-04
Location : ABU DHABI

I called my broker recently and asked what was good to buy his response was BUKI. Well with so many value deals around if this is what brokers are doing I am sure this is only a temporary respite before the trend resumes