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MARKET CRASH | How and when to BUY the DIP? - YouTube
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so whenever the stock market Falls
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retail investors get super excited and
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we start buying the dip left right and
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center now according to a recent survey
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that was done by Vanda research they
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approximated that retail investors are
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sitting on a loss of 32 on their entire
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portfolio in the recent sell-off now
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this is a fairly big fall and this might
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make you question the notion around
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buying the debt this Viewpoint was
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echoed by Mr nitin kama's wheat also he
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ended up saying that retail investors
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got saved inadvertently so the word of
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the day today is inadvertently let me
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know what does that mean the retail
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investors got lucky because they did not
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get demolished in the recent crypto
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crash Why was that because the Indian
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government came out with stringent tax
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laws around triplos so lot of retail
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investors did not end up purchasing
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cryptos or buying the dip in the crypto
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space now these viewpoints are very
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fascinating and they will make you
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question the entire logic of buying the
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dip but this should also make you
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question these strategies that retail
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investors adopt in terms of buying
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stocks probably we make a mistake in
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terms of entering stocks too early or
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trying to buy every single dip that
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exists so on and so forth so probably
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our methodologies could be off now I
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cannot speak about all the investors out
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there but at least in my case these
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stocks that I had purchased from 2021
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onwards when the stock market started
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dipping I'm sitting on a five percent
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loss on my portfolio but if I compare
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this number to the average investor it
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is around 32 as the research said so I
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thought that why not share some of my
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strategies as to how I am I buying the
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dip whether I am purchasing the dip
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still and what would be the right
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mechanism of purchasing the current dip
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so let us get the discussion started I
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will make this
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so number one let us quickly understand
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what exactly is meant by buying the dip
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and should you be buying the dip in the
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first case so buying the dip is a very
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simple concept which says that whenever
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the market Falls you should invest more
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money so for example on this particular
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chart of nifty fifty you can clearly see
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that this is where the market started
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falling so these are three different
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occasions when Market fell quite
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aggressively so if you are buying on
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these slopes it would be considered as
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buying the dip so should you be buying
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the dip the short answer is yes you
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should 100 be buying the debt because if
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you are not buying when the markets are
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falling and if you're only buying when
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markets are rising how will you make
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money so imagine this and let me zoom
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out the nifty 50 chart it will present a
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much cleaner story now what you can
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clearly see is that in the long term the
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nifty 50 chart generally goes up if you
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take a three year five year ten year
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window nifty 50 will go up there can be
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short-term pain that probably there
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would be a couple of years when nifty 50
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or any index for that matter might not
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be giving out very good returns but as
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long as you are investing in good
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indices or good stocks and whatever
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stuff you are purchasing during the
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downturn that ends up giving you the
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most return so imagine this and let us
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plot couple of points here to just
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outline the story very very clearly so
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let us imagine point a to be this point
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B to be this and point C to be this and
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let's imagine that you invested 1000
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rupees in each of these dip right so
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where do you get to purchase the most
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amount or most units of nifty 50 you
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will end up purchasing the most unit at
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Point C because the market has fallen
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the most and whenever the market Rises
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for example let's say that the market
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Rose eventually after two three years to
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this point D then which of these
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investment ends up giving you the most
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return it is the investment or the Sip
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that you made at Point number c so the
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core message that I'm trying to deliver
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is that a falling Market looks very very
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scary for everyone and yes today you are
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investing in a polling market and
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tomorrow it might fall even more and day
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after it might fall even more and you
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might start panicking but the fact
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remain means that if you are purchasing
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good assets those assets will come back
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up and the Investments that you have
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made during a volatile or in a falling
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Market or during a dip Market those are
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the ones that are likely to give you the
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most results so therefore buying the dip
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is critical and essential if you end up
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investing somewhere here in point e for
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example this is where you invest all of
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your money when the markets are trading
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at an all-time high and when the markets
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fall that is where the actual pain
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exists right now there is something
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called as margin of safety in the
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markets can it fall more absolutely 100
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it can fall more no one can guarantee
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that the markets are not going to fall
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or markets are only going to fall by 10
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more percent all that stuff no one can
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predict but right now as we are sitting
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and you can compute it here that how
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much the market has fallen from its top
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there is a safety or margin of safety of
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roughly 13 on the index itself so
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according to me buying the dip even now
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is not a bad move am I buying a dip 100
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I am buying a dip is it a recommendation
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from my side for you to end up investing
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in the market the answer
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and honestly I don't want to debate
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people in the comment section that
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akshat you're wrong about this talk that
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stock folks please understand that the
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entire Market has fallen by 13 14 the
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stocks that I keep talking about they
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will also fall because the entire Market
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is falling that is the simple
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explanation that I will give you there
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that does not mean that these stocks
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have forever fallen and they will never
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rise up so on and so forth now with that
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Viewpoint let us understand Point number
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two which is as to how to buy the dip
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this is very very important and this is
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where majority of the people make a
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mistake why because their goal of buying
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the dip is not clear now there are two
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reasons why you should be buying the dip
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the first is called as momentum trading
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and you might be investing in the debt
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so let's pick an example and clarify
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this point so let's pick nifty 50 only
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and you saw that in the last five days
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nifty 50 has fallen by roughly 1.6
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percent now you feel that you know what
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markets have come down they are
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definitely going to go up so tomorrow
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when the markets open I'm going to
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invest a big chunk of money in the
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market and with what expectations you
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are going there you are going with the
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expectation that you are going to swing
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the Nifty and you are going to make some
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money so you are going in with the
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expectation of doing a swing trading or
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doing a momentum trade that right now it
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is going down and your assumption is
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that this is the end of the dip from
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here the markets will start recovering
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and whatever money I am pouring tomorrow
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from day after onwards the market will
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start running now can you precisely
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predict the depth the answer is no you
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will not be able to do it you can apply
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any technical indicator right now
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markets are not functioning as per
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technical indicators here is a statement
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by Mr Vijay kedia that he made zero
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percent Returns on his portfolio in 2021
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now his portfolio might be in a loss
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because in the last few days the markets
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have actually come down not gone up now
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if you use your brain and a little bit
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of logic you can easily figure out that
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if one of India's biggest investor is
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not able to figure out when the dip has
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ended and when the markets are
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completely corrected how can you and me
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figure that out the answer is that we
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can't figure it out so your assumption
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that okay I'm going to swing the Nifty
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very very easily that is incorrect
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unless you are willing to hold out your
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investment in the market during these
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volatile phases you are not going to
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make money now the second reason why
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people buy the dip is more sensible and
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the reason is that they are buying the
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dip because some good assets are
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available at a discount does this mean
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that the markets cannot fall further the
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answer is no markets can very well fall
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further no doubt about that but some
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good assets are available at a discount
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now these assets could be something like
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hindustanian liver it could be Pedialyte
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it could be TCS it could be any stock
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that you like if the stock has corrected
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quite a bit and then if you are buying
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the dip on that stock it might make
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sense but with the expectation that
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you're okay holding that stock and you
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are okay holding and witnessing that
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volatility if you have zero patience in
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terms of holding a stock or holding a
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good cryptocurrency asset or holding a
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good real estate then you will not be
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able to make money every time the market
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shakes a little bit you will just sell
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your portfolio off and go away so please
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identify the reason as to why you are
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buying the dip if you are simply doing
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it for swing trading in several types of
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Market swing trading is not working
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right now swing trading is not working
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no Traders are able to consistently make
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money in this market that is the simple
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fact but yes if you are of the view that
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I am buying the dip so that I can get
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hold of some really good assets at
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decent enough prices and I'm okay
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holding it off then this next section
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becomes important for you now let us
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understand couple of strategies to buy
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the dip what I am currently using and
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hopefully it might be useful for you so
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that you can mitigate some of your
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losses or if you're looking to build
[482]
your portfolio in this market these
[484]
strategies might come in handy so let me
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explain that first Viewpoint by taking
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you through the example of Alibaba now
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let us take a look at Alibaba stock from
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the moment I had made it so I had made
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this video on November 14th and if you
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check the prices around November so it
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was trading at roughly 130 140 so let's
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assume On The Higher Side 140 and right
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now it is trading at 113 Hong Kong
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dollar so total fall has been how much
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20 right so now you will say that akshat
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your prediction was wrong you made 20
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loss on Alibaba no I am sitting on maybe
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like three or four percent loss Alibaba
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now you will say that okay how is that
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possible it is because of the fact that
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I'm buying the dip and I'm downward
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averaging a stock in which I am
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believing in so this brings us to the
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first key principle of buying any dip
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which is that please don't put all your
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money in one go for example a lot of
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people commented on yesterday's video
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that akshat you made a video on Alibaba
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in November it was trading at 1 40. now
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there is like 20 loss on that stock we
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have gone bankrupt why did you go
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bankrupt on this because you ended up
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purchasing everything here if you had to
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invest let's say 1000 rupees on Alibaba
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stock here you invested everything here
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I did not do that in fact if you go and
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check any of my videos and on several of
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my videos I have always spoken the fact
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that please split your amount in little
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little chunks for example if you go and
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check my analysis on something called as
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indiabulls Housing Finance unfortunately
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that stock fell and I categorically told
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on that stock that hey we are swinging
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the market but unfortunately from
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November onward Market started falling
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and I was only able to put one
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investment and I said that I am going to
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put 10 investments in that particular
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stock so anyways the first key critical
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lesson being that whenever you are
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investing in an asset especially in a
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growth tech company cryptos Etc please
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chunk out your Investments please invest
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in at least at least four installments
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if you are buying a dangerous stock for
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example indiabulls Housing Finance I
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categorically said 10 installments so
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from that logic I've been buying Alibaba
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since November and therefore my loss on
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the stock has been roughly like three
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four percent which is very nominal given
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the fact that the entire world is
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grappling through inflation so many
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different different problems are
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happening and we are witnessing one of
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the very serious crashes out there so I
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hope this first strategy is clear now
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let me talk about the second strategy by
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picking the example of Bitcoin and this
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is called as letting an asset
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consolidate so what is meant by
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consolidation let me take you to bitcoin
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chart now Bitcoin from its top has
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corrected by roughly 50 but on a
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volatile asset like any growth stock for
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example Amazon has also corrected by 40
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approximately meta has corrected by 50
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60 and then a bunch of stocks that are
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considered to be growth stocks so these
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stocks start running very fast when the
[643]
market starts to run and when the market
[645]
consolidates or when the market Falls
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these stocks are the ones that will fall
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the most so there is nothing to panic
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about on this front as long as you
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understand this basic point so coming to
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the topic of Bitcoin you know that it is
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a volatile asset in case you are looking
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to build position or buy the dip in
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Bitcoin then you should be purchasing
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something like Bitcoin on consolidation
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points so for example you will see this
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Zone where Bitcoin is getting
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Consolidated here it is getting
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Consolidated this was a big
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consolidation Zone and this is forming
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to be another big consolidation zone so
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let's assume that you had to put 10 000
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rupees in Bitcoin and what would you do
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that when the market is at top would you
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go and invest all your money in Bitcoin
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during that time the answer is no you
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should not be doing it so probably you
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would have purchased let's say two
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thousand rupees of Bitcoin then here
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when the market started falling you
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should not have purchased it here you
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should have purchased it when the market
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Consolidated again so here you could
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have purchased another 2000 then here
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again there was a big consolidation here
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so you could have purchased another 2000
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then here again if you would have
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purchased Bitcoin here then another 2000
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and now you are left with 2000 rupee
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that you can further put in case the
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Bitcoin Falls more so from this
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particular perspective yes Bitcoin has
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fallen by roughly 50 percent but how
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much would have been your loss just try
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to compute it run your mathematical
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model and tell me in the comment box and
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I can guarantee that to you that just by
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using this simple consolidation
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principle you could have saved a lot on
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your losses so this is a simple
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Viewpoint these are some of the points
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that I have explained on some of my
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earlier videos also it's not as if that
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I'm bringing it up for the first time
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but it hurts me a lot when people do not
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even watch the video they will just look
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at the thumbnail next day pour all their
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money on that stock stock market crypto
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Market is supposed to be volatile if you
[750]
are acting like a crazy person then you
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will end up absorbing the maximum loss
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that can happen on a particular asset so
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before I close out the video there are
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three critical points that I want to
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leave you with that number one buying a
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dip is good there is nothing wrong in
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terms of buying the dip I am also buying
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the dip but the important point is that
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you must buy the dip on assets that you
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have trust on this is not a push from my
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side to make you buy Bitcoin or X asset
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or why asset please do your own research
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please buy assets that you have
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convection in and buy only when you can
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handle volatility if you have no faith
[781]
on your analysis and research you can
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give your money to mutual fund managers
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and by the way check their portfolio
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also you will be quite surprised so that
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is point one point two please understand
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the concept of systematic versus
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unsystematic risk systematic risk means
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that if the entire Market is falling you
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can't do anything for example if there
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is World War III then do you think that
[800]
any Market will be saved the answer is
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no that is a systematic risk so to say
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you can't diversify that through your
[806]
good investment strategies everything
[807]
will fall if such a situation comes up
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but what about unsystematic risk
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unsystematic risk means that you are
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sensible enough in terms of applying
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hedging strategies in terms of
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understanding how to buy the dip on
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consolidation these are basic basic
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points that you must incorporate in
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terms of your investment strategy
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because if you go crazy that you have
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identified like some great asset I'm
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going to pour all my money in it that's
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a really really bad move so this is
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point number two point number three
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please be responsible for your own money
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you don't need to listen to me or some
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other YouTuber or some other person or
[840]
XYZ Minister from India you don't need
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to do that you need to trust your
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judgment at the end of the day because
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it is you who will be pressing the buy
[847]
button or sell button on stocks or
[850]
cryptocurrencies in whichever asset you
[851]
choose to invest also a very quick note
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some of you have been reaching out and
[855]
saying that akshat you know what world
[856]
is not accepting INR deposit is there
[858]
some thing that we can do so number one
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this is an exchange specific problem
[862]
that is happening with majority of the
[864]
exchanges in India you are not being
[866]
allowed to transfer money from your
[868]
Indian bank account to that crypto
[870]
exchange so this is something that the
[872]
teams are already working on meanwhile
[874]
can you do something yes please go and
[875]
use binance you can use peer-to-peer
[878]
transaction in terms of buying and
[879]
selling cryptocurrencies now again
[881]
please be responsible yourself if you
[883]
don't know how p2b buying and selling
[885]
works and if you just listen to me
[887]
please do not put the blame on me that
[888]
you know what actually I made like some
[890]
incorrect entry in terms of sending
[891]
money to someone please be responsible
[893]
please read instructions and please
[895]
follow along there is no scam that is
[897]
going around in crypto exchanges it is a
[899]
simple back-end problem in which banks
[901]
are not allowing crypto exchanges to use
[903]
their infrastructure so to say so this
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is simply what is happening so I hope
[906]
you found this video to be useful
[908]
insightful and I really really wish that
[910]
you listen make notes investing is a
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serious game and you would take it
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easy thank you so much and I will see
[915]
you soon
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