"Life offers many fruits, yet the most satisfying are those that require patience to ripen."
-K.
I believe that the most fulfilling rewards in life come to those who wait. While many things may come quickly, the truly worthwhile achievements require time, resilience, and dedication.
Much like the ripening of fruit, life’s most satisfying outcomes develop with patience and care. A wise man understands that what is most deeply rewarding is often cultivated slowly, and its richness is worth every moment of the wait.
-K.
I believe that the most fulfilling rewards in life come to those who wait. While many things may come quickly, the truly worthwhile achievements require time, resilience, and dedication.
Much like the ripening of fruit, life’s most satisfying outcomes develop with patience and care. A wise man understands that what is most deeply rewarding is often cultivated slowly, and its richness is worth every moment of the wait.
India's Bajaj Finance eyes best week in 3-1/2 months after unveiling FY25-29 growth strategy. ** Shares of Bajaj Finance BAJFINANCE
rise as much as 1.3%, eye fifth straight session of gains
** Stock up 5.2% so far this week, on track for best weekly gain since Aug. 30, if gains hold
** Co said on Tuesday green finance, AI, organic acquisitions, and focus on personal and gold loans among key growth drivers as it unveils FY25-29 growth strategy
** More than 1 mln shares change hands, 1.2x its 30-day avg
** 28 analysts covering the stock on avg have a "buy" rating; median PT is 8,083 rupees - LSEG data
** BJFN shares down 2% YTD vs a ~14% rise in Nifty 50
NIFTY
rise as much as 1.3%, eye fifth straight session of gains
** Stock up 5.2% so far this week, on track for best weekly gain since Aug. 30, if gains hold
** Co said on Tuesday green finance, AI, organic acquisitions, and focus on personal and gold loans among key growth drivers as it unveils FY25-29 growth strategy
** More than 1 mln shares change hands, 1.2x its 30-day avg
** 28 analysts covering the stock on avg have a "buy" rating; median PT is 8,083 rupees - LSEG data
** BJFN shares down 2% YTD vs a ~14% rise in Nifty 50
NIFTY
Understanding Market Corrections: Insights and Lessons with TradeWithRaj
Market corrections are often recognized as opportunities only after recovery, not during the correction itself. However, these corrections are an inherent part of financial markets. The term "correction" signifies restoring something to its appropriate value. The key question to ask is: Should one focus on price correction or valuation correction?
Market corrections are often recognized as opportunities only after recovery, not during the correction itself. However, these corrections are an inherent part of financial markets. The term "correction" signifies restoring something to its appropriate value. The key question to ask is: Should one focus on price correction or valuation correction?
The Role of Valuation in Market Corrections :
Valuation is commonly gauged using financial ratios like Price-to-Earnings (P/E) or Price-to-Book (P/B) ratios. For instance, the P/E ratio rises when stock prices outpace earnings growth during the same period. If prices significantly outstrip a company's earnings potential, the stock is deemed overvalued or even "extremely overvalued."
In market terms, when prices surpass their fair valuation, a correction becomes inevitable. Valuation corrections occur when corporate earnings rise during a market decline, enhancing intrinsic value and creating better investment opportunities.
Valuation is commonly gauged using financial ratios like Price-to-Earnings (P/E) or Price-to-Book (P/B) ratios. For instance, the P/E ratio rises when stock prices outpace earnings growth during the same period. If prices significantly outstrip a company's earnings potential, the stock is deemed overvalued or even "extremely overvalued."
In market terms, when prices surpass their fair valuation, a correction becomes inevitable. Valuation corrections occur when corporate earnings rise during a market decline, enhancing intrinsic value and creating better investment opportunities.
Historical Analysis of Nifty 50 Corrections :
The historical data of the Nifty 50 Index reveals 11 significant corrections exceeding 15%, with the current correction standing at 11%. In several instances, valuation corrections outpaced price corrections, signaling that corporate earnings grew despite declining prices.
Below is a detailed table summarizing these corrections and recoveries:
The historical data of the Nifty 50 Index reveals 11 significant corrections exceeding 15%, with the current correction standing at 11%. In several instances, valuation corrections outpaced price corrections, signaling that corporate earnings grew despite declining prices.
Below is a detailed table summarizing these corrections and recoveries:
Key Observations
Valuation vs. Price Correction: In five cases, valuation corrections exceeded price corrections, highlighting periods where corporate earnings grew even as stock prices fell.
Recovery Time: On average, the correction period lasted 7 months, while the recovery took 12 months to yield significant returns.
Opportunities in Chaos: Corrections provide an excellent chance to invest in high-quality stocks at attractive valuations, turning short-term volatility into long-term gains.
Valuation vs. Price Correction: In five cases, valuation corrections exceeded price corrections, highlighting periods where corporate earnings grew even as stock prices fell.
Recovery Time: On average, the correction period lasted 7 months, while the recovery took 12 months to yield significant returns.
Opportunities in Chaos: Corrections provide an excellent chance to invest in high-quality stocks at attractive valuations, turning short-term volatility into long-term gains.
The Bigger Picture :
There’s a well-known Hindi saying:
"Aukad se zyada aur samay se pehle kuch nahi milta"
(“Nothing comes before its time or beyond one’s capacity.”)
Even when valuations rise above fair levels, corrections inevitably bring prices back to realistic levels. As a value investor, focusing on valuation rather than price fluctuations can help identify opportunities during corrections.
There’s a well-known Hindi saying:
"Aukad se zyada aur samay se pehle kuch nahi milta"
(“Nothing comes before its time or beyond one’s capacity.”)
Even when valuations rise above fair levels, corrections inevitably bring prices back to realistic levels. As a value investor, focusing on valuation rather than price fluctuations can help identify opportunities during corrections.
Conclusion
Market corrections can indeed be a blessing in disguise for value investors. By analyzing historical data and staying disciplined, investors can turn volatility into opportunity, positioning themselves for long-term success.
Stay tuned for more insights at @Tradewithraaj
Market corrections can indeed be a blessing in disguise for value investors. By analyzing historical data and staying disciplined, investors can turn volatility into opportunity, positioning themselves for long-term success.
Stay tuned for more insights at @Tradewithraaj
#reliance 1230 on the verge of hitting 52 week low and can continue the correction 1188 (2.618% ext of wave 1) of the #elliotwave 1-2-3-4-5
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