MAKING OF FUNDAMENTAL PORTFOLIO

Respected reader,

As you knew every third Sunday of month I choose a fundamental strong stock which trade at very low valuation due to bad conditions of company and particular sector.

Rules of this portfolio making is

1. Invest only 4500 in a single stock.

2. Minimum holding at least 1 year because after one year profits are tax free.

3. Buy only one stock at a month.

4. Do not be average out if stock fall after buying just hold because our loss is only notional loss at paper only. Because we already buy stock at lower price where it may be test our patience but all companies all belong to BSE group A with strong fundamentals. (Shri atul ji ask me that can we average out MTNL REL COM VIDEOCON etc so my answer is NO, just buy new entry of this month)

4. After one year we can free to sell a stock but never sell in loss read shopkeeper approach in this link for deep understanding this point

 http://sharegenius.blogspot.com/2010/09/shopkeepar-thinking-in-share-market.html

and you knew discipline is always win in stock market, I think you remember my last 6 month buying is MTNL, REL COM, DB REALTY, VIDEOCON,INDIA BULLS REAL EASTATE, HDIL each of these stocks run 5-15 % after my buying but as per rules I do not book profit because 1 year is not complete.

CLICK HERE TO READ PART ONE OF THIS ARTICLE IF YOU ARE NEW READER OF THIS FUNDAMENTAL PORTFOLIO MAKING.

  

Our past investment has a net notional loss of 4628.90 as per details below (read this detail carefully to understand my concept)

STOCK	PRICE	QUANTITY	INVESTMENT
MTNL	41.8	109	4556.2
RELIANCE COMUNICATIONS	107.4	42	4510.8
DB REALTY	81.85	56	4583.6
VIDEOCON INDUSTRIES	177.2	26	4607.2
INDIA BULLS REAL EASTE	120.3	38	4571.4
HDIL	100	45	4500
TOTAL INVESTMENT			27329.2

STOCK	PRICE	QUANTITY	MARKET VALUE
MTNL	34.8	109	3793.2
RELIANCE COMUNICATIONS	81.9	42	3439.8
DB REALTY	57.85	56	3239.6
VIDEOCON INDUSTRIES	175.3	26	4557.8
INDIA BULLS REAL EASTE	83.5	38	3173
HDIL	109.1	45	4909.5
TODAY MARKET VALUE			23112.9

OUR TOTAL NOTIONAL LOSS IS 4216.30

THIS MONTH TOP UNDER VALUED STOCKS OF GROUP A

Company Name	Last Price	% Chg	Book Value	PBV Ratio	Year
Reliance Comm	81.9	-3.02	244.66	0.33	Mar '10
DB Realty	57.85	-2.36	137.82	0.42	Mar '11
HDIL	109.1	4.8	225.97	0.48	Mar '11
Piramal Health	348.15	-5.15	699.63	0.5	Mar '11
Indiabulls Real	83.45	2.27	159.2	0.52	Mar '10
IFCI	34.9	-1.41	64.24	0.54	Mar '11
Videocon Indust	175.3	-1.02	310.89	0.56	Dec '10
Shipping Corp	86.65	1.23	136.05	0.64	Mar '10
GE Shipping	251.9	2.65	361.42	0.7	Mar '11
IndiaBPower	14.7	-0.07	19.38	0.76	Mar '10

So this month PIRAMAL HEALTH CARE @ 348 is a new entry for buying and as my formula I buy 13 stock of PIRAMAL HEALTH CARE .

·       Please do not be greedy and buy a huge quantity and then blame me.

·       This article is not an buying advice ask your financial adviser before follow my concepts.