In one of the sessions, the necessity of committing a substantially large amount to Best Buys Now stocks of VR Stock Advisor was highlighted. Would a monthly SIP of Rs. 30,000 for 10 stocks with a time frame of two-three years be fair? The ability to closely monitor and buy in dips has not happened in the last one year.
- Ganesh Sivaprasad
While investing in stocks, you should have a longer time frame, at least five years to begin with. It may be even longer after that. If you don't need all your invested money, then an investment of Rs.30,000 rupees per month should be good enough.
When I am answering this question, I am primarily looking at the cost of our VR Stock Advisor service. So, if the cost of its annual subscription itself turns out to be a substantial part of your annual investment, then it would not be worth it and your mutual fund SIP may be good enough because that is also a cost that you have to keep in mind. If you are going to invest over the next two-three years and you are going to stay invested for many years, then a Rs. 30,000 SIP is good enough.
With regard to your ability to closely monitor, we are going to supplement it substantially. Our analysts are always on their toes. At times, we have late-night discussions as well when something we get to know about these companies or when we need to send you an update early in the morning because something dramatic has happened to a company, which has happened on one or two occasions. We do this as we are at your service when it comes to looking at these companies closely and trying to inform you of any new meaningful information, which requires you being alerted about it.
With regard to buying at dips that you haven't able to do in the last one year, we had one of the biggest dips that happened in the month of March. About four-five months prior to that, we had a lot of our buy recommendations getting into the watchlist because the market was at such an elevated level where valuations were not attractive and hence, we stopped making any further recommendations. Many of those stocks on the watchlist became cheap and in fact, to our own surprise, one of those has doubled and another one has nearly doubled, ever since the recommendation that we made at these lower prices.
So, VR Stock Advisor filters quality stocks based on standard parameters i.e. whether a company is growing or not, whether it has credible and trustworthy management or not and whether it has growth potential in the future with economic tailwinds to support that or not. Besides, we also keep looking at the valuation. Today, our watchlist will have about 20-25 stocks and we are ready with the recommendation report. We are ready with everything except that currently, we don't find the price attractive enough to recommend any stocks at the moment.
So, go ahead with your Rs.30,000 SIP investment for next two-three years with a much longer investment horizon.