Where are the investors going ? – Worst Scenario of Retail Investors
The face of every investor in the Stock Market reveals different opinions or options. We, everyone knows the Stock market is generally subject to the Volatility. From the Father of Value Investing Mr. Benjamin Graham to the Biggest Investor and Wealthy man Mr. Warren Buffet, they are done the Fundamental Analysis for the Stock picking.
In the Indian Stock Market, there are few more listed companies went and going bankrupt. Brand names like Essar, IL & FS, RCOM had went in Debt crisis. Now, in the airline industry, the Jet Airways which is struggling to run its core business. The Founder was expelled, the airline company were controlled by the banks on Debt, The salary and the future of its employees happening all around.
Jet Airways had announced its last four quarterly results with a negative income (Net loss). As of March 2019, the fourth quarter is yet to be declared. The Share holding pattern were also downgrading in this listed Airline Company. Since December, 2017 the Mutual Funds which are DIIs and the FIIs (Foreign Institutional Investors) were decreasing their holding in Jet Airways. On the other side, the retail investors are buying this shares in every quarter.
The Mutual Funds had decreased its holding of 9.65 percent in December 2017 to 3.58 percent in the March Quarter, 2019. The Foreign investors had also cut down their holding of 4.96 percent in December 2017 to 1.47 percent in March 2019.
Where the Retail investors raised their stakes in every quarter – 3.81 percent which was seen in the quarter of December 2017 and now it was 11.42 percent in the March 2019. It is noteworthy that it is a risky one for the Retail share holders who are buying more shares in this Debt Company.
Generally, Value investors will analyze the based on Fundamental numbers and finding the opportunities, then they can invest in a listed company. Moreover if it is a weak one, so they can buy shares to acquire in the future.
Even after the exit of Mutual Fund houses and Foreign investors, the small investors had bought more shares in Jet Airways. This trend will create a negative impact for the Retail Investors in the Stock Market. If there is any company to acquire this Debt ridden stock, then it is a good one for that time. Although there are Companies which acquire some of the listed firms, still they are facing issues on that past business.
Like Tata Motors acquired JLR and Sun Pharma bought the Ranbaxy, till today they are gotten into the trouble. JLR is also struggling due to the Global economic factors. Similarly for the Sun Pharma with Ranbaxy on Official issues and there are some more stocks like it.
Therefore, it is good for small investors to reduce their risk and invest in stocks. Investing in a hurry that leads to fail in the Market and also in the Money Management. Whether it is a branding or Fancy stock or a Small Cap, it is better to lookout the business and Financial Reports. Don’t just lookout for the Cheap stock price – Penny !
The Retail Investors should avoid to invest in companies that suffer from Debt problems. When we choose the good and valuable stocks, we can also have a time to find out the earnings growth of a Business. If you are going for the Intra day or Swing Trade, keep to pick the good stocks.
Don’t be a Penny (retail) investors again in a Bad Stock 🙂
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