Assess your attitude towards equity investments! Growth Ltd's stock is expected to rise from Rs.200 today to Rs.250 over the year. Growth2 Ltd's stock is expected to rise by 25% from its current market price. Which stock would you buy? Growth Ltd. Growth2 Ltd. You hold the stock of Winner Ltd. whose price has doubled. You hold the stock of Loser Ltd. whose price has halved. If you had money and had to choose investing in either Company A or Company B, which stock would you buy? Winner Ltd Loser Ltd Recall the stock that has been the largest loser in your investment portfolio. Also, recall the stock that has been the largest gainer. Which has impacted you more - the loss or the gain? The loss The gain You hold the stock of Champ Ltd. whose price has doubled. You hold the stock of Flop Ltd. whose price has halved. If you need money and had to choose which stock to sell today, would you sell Champ Ltd. or Flop Ltd.? Champ Ltd Flop Ltd You were advised by your trusted financial advisor to sell the stock of Switchout Ltd and buy the stock of Switchin Ltd; you did so. Switchout Ltd rose and Switchin Ltd fell; how did you feel? Bad Very bad It didn't have any emotional impact on me You were advised by your trusted financial advisor to sell the stock of Switchout Ltd and buy the stock of Switchin Ltd; you didn't act on the advice. Switchout Ltd fell and Switchin Ltd rose; how did you feel? Bad Very bad It didn't have any emotional impact on me You bought the stock of Prosper Ltd at Rs.100 per share. The price falls by more than 10%. You have done sufficient research and are convinced that the company will grow in the long term. You-- Believe the stock is underpriced keeping your purchase cost of Rs.100 in mind. Review the company based on any new developments and market sentiment to decide whether you should buy more of the stock, hold or sell. You bought Gain Ltd at Rs.100 per share. The price rises by more than 10%. You-- Believe you have purchased the stock for cheap. You book profit by exiting. Review the company based on any new developments and market sentiment to decide whether you should buy more of the stock, hold or sell. You have maintained your portfolio as-- Trading portfolio and investment portfolio Stock portfolio and mutual fund portfolio Equity portfolio and debt portfolio Just one portfolio that consists of all investments You inherit your father's investment portfolio. You-- Decide to keep it separate from your own portfolio. Merge it with your portfolio. You invested in the stock of Longterm Ltd five years ago. The stock price has risen and so far, you are in profit. The stock price has been falling over the last few months. You find out that the company is facing some challenges. You are not sure whether this is a temporary situation or it may result in the company making losses in future. You-- Hold on. After all, over the last 5 years, it has given you profits and you believe in the company. It will overcome the present challenges. Buy more. You believe in the company and are confident it will overcome its problems. Exit. You don't want to lose your accrued profits. Review the company based on any new developments and market sentiment to decide whether you should buy more of the stock, hold or sell. How frequently do you check the prices of stocks in your portfolio? Daily; I want to stay alert to take action in case prices of my stocks fall below my purchase cost. Once a month; I like to check the value of my portfolio simply to keep abreast of my wealth levels. This also helps me find out if prices of any stocks in my portfolio have fallen significantly so that I can find out reasons for the fall. Once a quarter; my investments are made for the long term and I don't feel the need to frequently check stock prices. However, I keep abreast of quarterly results of stocks I own. Very occasionally. I just don't get the time! Let's say that the BSE Sensex tumbles over a very short time period due to a crisis such as war, pandemic, etc. What would you do? I would consider this an opportunity to buy stocks that become value picks. I would sell my investments; I would not want to risk a further fall in my portfolio value. Let's say the company whose stock you hold declares a 1:1 bonus, i.e. for every share you hold, you get a share free. You are-- Happy; after all you got free shares! Not affected; you know that bonus shares don't mean 'free' shares. Have you borrowed to invest in a stock? Yes No Have you invested a large portion of your portfolio (say 30% or more) in a particular stock? Yes No A stock has been falling on every trading day consecutively. Do you believe it will-- Continue to fall Rise You cannot say You have inherited your father's portfolio. You -- Have retained it due to sentimental reasons. Changed it based on developments with respect to various securities in the portfolio. How many securities (stocks, bonds, etc.) do you hold in your investment portfolio? 8-10 10-20 More than 20 Your friend tells you that he has a gut feel that the markets will rise/fall. He advises that you buy/sell to profit from his gut feel. You respect and trust your friend’s knowledge and judgment. Would you act on his gut feel? Yes No Please fill in the comment box below. Time is Up! Time's up Share on FacebookTweet Related By Sharmila I am a finance professional; I educate people on how to manage their finances and invest to grow wealth and fulfil their financial goals. View all of Sharmila's posts.
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