As an analyst’s job is to analyse and not forecast, it’s time individuals used common sense approaches for picking stocks

We are going through turbulent times and investors have lost heavily as they had based their investment decisions on forecasts of the so-called experts. Many experts would agree that there are no geniuses in the markets. It’s the media who makes them (experts) or a short spell of luck.

Let’s go back just six months in time. We had practically most of the …

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Fluctuations are a common feature of financial markets. However, fluctuations - both positive and negative - can be sudden and dramatic, and can catch even experienced investors off-guard. In turbulent financial times, it is important to understand the economics that underpin all markets - beyond short-term volatility - and to consider market movements from a longer-term perspective.

In public interest, Fidelity Mutual Fund brings a new volatility micro site that helps you do just that with three easy tools:

All stock markets recover from …

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… Continued from Part 1 (ETF: Better investment option today)

Are ETFs like index funds?

Exchange traded fund (ETFs) and index mutual funds both seek to match the return of a market index. Both suit investors looking for diversification. However, there are important differences. The first is the minimum investment. For investors with limited funds (say, less than Rs 1,000) who want to get started in the stock market, ETFs offer a cheap entry option — you can buy even …

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An exchange traded fund (ETF) is essentially an index fund that trades like a stock and is listed on the exchange. Although popular abroad, it’s still a new concept in India. Currently, India has 16 ETFs, with total assets under management (AUM) of Rs 4,182 crore as of September 2008. In the US, by contrast, there are 707 ETFs, with combined AUM of $585.9 billion!

An ETF is a single security representing a basket of stocks that corresponds to a particular …

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Recommendation: Buy

The IT industry has been under pressure recently due to worries about the US recession. The problems in the developed economies will affect business flow over the next few quarters. But the past experience of recession in 2001-03 shows us that cost-cutting pressures in a downturn can actually give a boost to outsourcing.

Infosys remains the best bet in the industry with world class management and the best risk management systems. Available at a P/E of 12.5, I would strongly recommend Buy …

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3M India

Recommendation: Buy

A unique company selling branded industrial goods. It operates in many segments like display and graphics, home and leisure, office, healthcare among others. Its growth is thus linked to the broad industrial growth in India.
With urban India getting more quality conscious, 3M is seeing strong products’ demand growth. A strong pipeline of innovative products to be launched will give it continued growth over the next decade. It will report an EPS of Rs 60 in CY08.
It has quite …

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Recommendation: Buy

Pantaloon Retail is one of the flagship retail companies in India. Though the stock has dropped from a high of Rs 875 to a low of Rs 195, the core underlying business continues to grow at a healthy pace. Pantaloon continues to expand its retail footprint and the weakness in realty is a positive factor.

The mall segment of Pantaloon will be the worst affected in the realty space due to over construction and as builders have preferred not to sell …

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