What is Positional trading | Bajaj finance 52-week low
 |
| Sanjiv Bajaj |
Why lower circuit on Bajaj Finance?
- Bajaj Finserv's chairman and managing director Sanjiv Bajaj in an interview said that the company recently lost 3.5 lakh customers in just 10 days because of the lockdown and they also said that if the RBI and government ignore NBFC's (non-banking financial companies) which are also supporters of the economy, then it will be bad for the future condition of the economy. The private banks are having cash but they are not risking their money by lending it to the NBFC's and this is wrong because they are playing very safe and the small NBFC's and small businesses will be collapsed because of this situation.
- Therefore, Sanjay Bajaj also says that if the lockdown situation continues for over 2-3 months, then it will be bad for their companies like Bajaj finance and Bajaj Finserv.
- Hence this statement of Sanjay Bajaj gave a sign to the shareholders to exit from the share and which is why the Bajaj Finance is on the lower circuit.
Which strategy to be used to minimize our losses and maximize profits in Bajaj Finance?
As far as I know in these types of situations mostly the retail investors are trapped and played by the operators which is not good for them and when this situation occurs retail investors square off their positions from the shares, which again makes the situation worse.
Bajaj Finance is fundamentally a strong company which is the plus point of buying this stock and it's been predicted that this stock can pass the level 1500.
So the ultimate solution comes is positional trading, in this trading we usually make 5 installments to buy any stock. That means if you have an approx. Of 1 lakh rupees then you will make 5 parts of that money and invest the 5 parts at different positions/prices/levels which can minimize your losses in the long term and can gain you more profits after the situation gets normalized.
Example:
If you have got this stock at 2100 Rs and now you are in a loss of >100 Rs, then you will make your second installment at 1700-1800 Rs after that if the situation gets worse this stock will get more degraded, then you have to go for the third installment of 1500-1600 Rs and then we will examine the future situation and decide that we have to make 5 installments or only 4 installments, till now our three installments are completed after examining we will put the fourth installment in the same range but a 100 points lower or the lowest we get and it will make our investment total amount lower.
And the average we will get will be of (2100+1750+1550+1450=6850Rs) and the shares will be 4 now if we average and take out the per-share cost it will be 1712 Rs. which will make your losses considerably lower from today and also if this stock crosses the level of 2000Rs when the situation gets normal it will give you a profit of 300Rs per share, sounds great.
But some people will doubt that how can this stock cross the level of 2000 after falling so much, so for them, I will say that they have invested in this stock because the financials and management of this company were great and in this worse situation also this company's management will find out a way to bounce back and it's also the second-largest NBFC which also increases the hopes of a bounce back.
Lastly, the decision is yours but this situation happens in every stock and the ones who hold back are the ones who also hold the profits. So be one of them who hold the profits, not the losses.
If you want to see my review about Bajaj finance, then click on the link given below.
Bajaj Finance stock review.
Positional trading:
This is the only strategy which retail investors should use now in Bajaj Finance because if they square off they will be in losses and if they bought shares in a bulk in one time, then also they will be in losses because this stock has yet not stopped its crash it can go more down.Bajaj Finance is fundamentally a strong company which is the plus point of buying this stock and it's been predicted that this stock can pass the level 1500.
So the ultimate solution comes is positional trading, in this trading we usually make 5 installments to buy any stock. That means if you have an approx. Of 1 lakh rupees then you will make 5 parts of that money and invest the 5 parts at different positions/prices/levels which can minimize your losses in the long term and can gain you more profits after the situation gets normalized.
Example:
If you have got this stock at 2100 Rs and now you are in a loss of >100 Rs, then you will make your second installment at 1700-1800 Rs after that if the situation gets worse this stock will get more degraded, then you have to go for the third installment of 1500-1600 Rs and then we will examine the future situation and decide that we have to make 5 installments or only 4 installments, till now our three installments are completed after examining we will put the fourth installment in the same range but a 100 points lower or the lowest we get and it will make our investment total amount lower.
And the average we will get will be of (2100+1750+1550+1450=6850Rs) and the shares will be 4 now if we average and take out the per-share cost it will be 1712 Rs. which will make your losses considerably lower from today and also if this stock crosses the level of 2000Rs when the situation gets normal it will give you a profit of 300Rs per share, sounds great.
But some people will doubt that how can this stock cross the level of 2000 after falling so much, so for them, I will say that they have invested in this stock because the financials and management of this company were great and in this worse situation also this company's management will find out a way to bounce back and it's also the second-largest NBFC which also increases the hopes of a bounce back.
Lastly, the decision is yours but this situation happens in every stock and the ones who hold back are the ones who also hold the profits. So be one of them who hold the profits, not the losses.
Conclusion:
Company is performing better and giving its best during this situation. The factors affecting the company are external and not internal which means the external factors will someday go away but if the company has internal factors affecting it such as Yes bank then it will never get out of it. So keep trust on your investments and give them time to be cured and make a jump. Thank you for reading my blog, I hope I have changed your decisions for Bajaj finance after reading this blog.If you want to see my review about Bajaj finance, then click on the link given below.
Bajaj Finance stock review.
Comments
Post a Comment