When you stay invested in a particular security regardless of its trend, you lose out on the possible gains which you could have generated by investing in securities which are actually moving up.
Churning your portfolio according to the prevailing market circumstances is the only way of making consistent profits in the stock markets.
After all, what good are unrealised profits if you fail to book them at the right time?
Simply put, Emotions are the enemy of an investor. ‘Buy and hold’ strategy implies being invested throughout both, Bull and Bear markets.
It is effortless to stay invested during the Bull markets when all the portfolios are green and alive, However, during bear markets or abrupt crashes, Investors make decisions based on emotions and sentiments.
If market has repeatedly rallied after every crash, then why have investors practicing ‘Buy and Hold’ booked losses?
Markets everywhere, have moved in Directions, Namely Bull & Bear. It is of utmost importance to identify whether one is dealing in the bull market or the bear market. Just like one cannot fly a kite high up in the east when the winds are moving towards the west, one cannot expect their stocks to go high up in a bear market. Even the strongest winners end up giving average returns if the market direction is not in their favour. Simply put,
Your portfolio will soar high up only if it flies in accordance with the winds of MARKET DIRECTION.
Although one might initiate buying during the corrections in a bear market, it carries more risk as the markets continue to move in the general downtrend eventually. The goal of MILARS is to perform the quintessential task of protecting your profits while cutting your losses.
Studies show that 37% of a stock’s price movement is directly tied to the performance of the industry group the stock is in. Another 12% is due to strength in its overall sector.
It is important to understand which industries or sectors will flourish in certain market circumstances and which sectors have lived past their best days.
MILARS has exclusively designed Proprietary systems to be ahead of the curve in identifying the leading industries and ranking it according to their growth performance.
Seasonality, business cycles, changing technology & changing preferences are just the tip of the iceberg in the list of factors which impact industry ranking.
The leading industries will most likely be the industries which are experiencing a structural change which will last for some time to come.
Investors have often sought comfort in familiar stocks which they have heard about over the years. The reason they might be familiar with the stock may be because of their previous performances in the preceding Bull runs. However, these previous leaders may not be leaders anymore.
As the saying goes, Past performance does not guarantee future returns. These sentimental favourites often turn out to be the dullest laggards in the next bull market.
At MILARS, we only choose leaders.
The next leaders, which are chosen by MILARS usually consist of quality earnings and growth profile. In essence, these companies are expanding. Either by gaining market shares from old/unorganised players or by launching new products/services. These companies may not be blue chips or even large caps. But at times these smaller leaders go on to become big names.
It is rightly said that profit is the lifeblood of a business. Business earnings have a direct impact on the prices of their stocks. As an investor, what matters most is the earnings of your shares in the company ie the EPS. Accelerating earnings attracts investments from institutional investors. It also denotes expansion which is an ideal feature of quality stocks.
MILARS emphasises on quality in investments & hence focuses on companies with explosive earnings growth showing high price strength.
Recognising real potential & reading between the lines are skills acquired over the years and MILARS Research Analysts constantly screen across the Indian equity markets to spot quality stocks with acceleration in earnings.
Relative price strength [RS] comparison is our proprietary rating tool that rates stocks on the basis of their price performance. We have a percentile stock ranking system where we place stocks in different percentiles [1-99] based on their price performance.
The price of stocks discounts everything. When something in the underlying company is structurally changing, it is always reflected in the price.
MILARS’s Relative Price Strength [RS] comparison is designed to detect when something is up in the company and whether the stock is under accumulation.
Our Research team then actively works on understanding the reasons behind the price changes & determining its sustainability based on various price levels.
Exiting your stock at the right time is as important as selecting it. Most Investors suffer from not being able to exit their positions at the right time and end up losing a substantial stake of their gains despite their investments reaching new peaks during their holding period.
Similarly, a lot of investors fail to realise that their stocks will have to generate a return of 100% to just reach the break-even price when in fact it dropped by 50%. It is unlikely for a stock, which dropped by 50% to generate such returns in the short term horizon without any substantial change.
Cut your losses short and let your winners run is the golden rule to optimize profits.
At MILARS, we have strict selling rules for both cutting losses and booking profits. We don’t budge from our rules at any point which helps us to stay in the game for a very long time. We maintain discipline by enforcing strict usage of the stop-loss tool which shields the portfolio from the negativity/euphoria that is created in the market which is fuelled by speculation.
Three key feelings adversely affect the returns: fear, greed, and frustration or impatience. One must always stay calm in investment and business.
MILARS brings logic to investment decisions rather than let emotions take over. Our reliance and disciplined approach towards our six guiding principles enables us to separate emotions from our investment decisions. We strictly believe in pursuing only winners and cutting our losses early so as to maintain ideal investments in our portfolios.
Most of the investors fail to track their investments. The fact that most long-term investors adopt a 'Buy and Hold' strategy, only to have their investments soar high up and come back down to the initial levels prove it. What good are unrealized profits if you fail to book them at the right time?
MILARS maintains constant track of the investments and makes timely decisions so that unrealised profits can be booked at high levels and reinvested again at opportune levels, thus enabling our investors to utilize the benefit of compounding effect while reducing the invisible burden of opportunity cost to a great extent.
Large Cap Focus:
An investment solution based on the MILARS Strategy that helps you invest in trending Blue chip stocks while countering volatility. Ideal for investors who prioritise stability in their stock investments.
Emerging Market Leaders:
An investment solution based on the MILARS Strategy that helps you invest in uptrending midcap stocks while striking a balance between volatility and rewards. Ideal for investors seeking growth in their stock investments.
An investment solution based on the MILARS Strategy that actively aims to generate high returns from the smallcap segment. Ideal for investors seeking high growth returns from their stock investments.
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