Key excerpts
"future is never certain"
"when the market price of the stock or the Index is going up, it is assumed that there is no uncertainty. Conversely, when there is a bearish trend in the market, the talk of “uncertainty” crops up more"
"there are simply too many variables that determine how the price of a company’s share moves, or how an overall index moves. These factors are in nobody’s control. The appropriate option available with us is to identify the four or five important factors in each company’s business/stock price and try to see if they are favorable to us as investors"
"We are NEVER going to get full information on the market, or about any single company. Let us not forget that there will always be unforeseen events and surprises, sometimes positive, and sometimes negative. How we respond to these events is far more important than trying to predict them in advance."
"Lets Look at below table to understand how many economic uncertainties have come in last 3 decades"
"An interesting point about the data above is that prolonged bear markets were caused not by “uncertainty” caused by political events/terrorist attacks/natural disasters. Almost all prolonged bear markets have been caused by excessive valuations. For instance, after the sharp fall suffered by the market in March 2020 (caused by the panic during the initial weeks of the COVID pandemic, the market recovered to its earlier level in 10 months. But the market took 5 years and 10 months to recover after peaking in January 2008 (the fall caused by excesses in valuation)."
Read Full: https://www.o3.am/o3%20PMS%20Newsletters/2021/o3%20PMS%20Newsletter%20-%20May%202021.pdf