Struggle to make money from stocks

For the past couple of weeks, we have seen the market rise from the lows of mid-12,000 that were seen a short time ago, and the Sensex has been above the 15,000 mark for some time now. This has not been because there has been an improvement in the economic situation over the last few weeks; the inflation rate is beyond 12%, something that will scare most governments to death. Instead, the stock market seems to be doing better primarily because of 2 reasons:
- Results have not been so bad and the advance tax collections seem to remain good
- Oil has been coming down for some time now, and is now 30 dollars below its all time high of $148
However, these remain bad times for the market. It is very difficult to predict as to how long the situation will remain like this. There are regular reports in the newspaper now about the bad situation of many sectors such as automobile, airlines, financial sectors (because of loans reducing), realty, and so on. At such times, it is difficult to stick your neck out and make a prediction that things will get better (and you should be skeptical of anybody who does make such claims without proper reasoning).
So what does one person do in such a situation ? The best possible approach is to continue to make small investments in companies such as Reliance, Airtel, L & T, HLL, Infosys, and other such companies that have good management, sound fundamentals, and the ability to ride out bad phases that the economy goes through.

Labels: Equity, Future, India, Inflation, Oil, Stock

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