Only One Stock Investment Strategy Can Help You Gain Good Returns

If you are investing or trading in stocks, then you must have experienced a downfall in stock price once you buy it. And the moment you sell the stock, the price touches the sky. Then you start grieving your decision to sell. The thought that comes to the mind is, “Kash kuchh der aur wait kar Liya hota”.

No one can predict the high or low and no one wants their stock portfolio in red color. I am sure you must have gone through numerous videos on YouTube regarding investment strategy using different indicators like moving average, supertrend, RSI, Bollinger bands, advanced VWAP, etc.

But what if I tell you that you need not follow any of the indicators and follow a simple strategy to gain profits in long-run. The only application required to track the stock price is the tradingview. 

Trading strategy

Just follow these simple steps to find the right stock and the right time of investment and trading:

1. Bluechip companies or trending stocks

The first thing you have to do is to identify the blue-chip companies or the stocks that have had rising trends since inception. 

Some of the stocks are Reliance, Hindustan Unilever, Astec, Titan, ICICI Bank, Dabur, Tata consumers, etc.

To identify trending stocks, open the chart in a monthly (M) view. I have attached the monthly chart of HDFC.

Finalize a list of 10 to 20 stocks because it would be easy for you to track the price movement on daily basis.

2. Spot the lows for buying

After finalizing the watchlist, check the daily stock up and down. The market moves in both directions. If there is an up trend for a few days then it will definitely follow a downward trend for the next few days. This happens because the market corrects after every few days, months, or years.

For this, you have to open the charts in daily (D) view and track a minimum of 4 red candles in a group. In the below chart of Grasim, I have highlighted the purchase points.

Now if you buy at a marked point, you can easily gain up to 9% in the next 6 trading days.

Assume if the market further decreases, then you have to wait for a few months to get a similar return.

3. Sell the stock once it touches 7% or more return

Once the investment gives more than 7%, sell the stock and buy again in the dip. Don’t wait for big profits because ups and downs are continuous.

Advice to beginners

1. Don’t fall into the trap of trading tips. If you will be profitable on one day then you are going to lose the next day, until you have a good destiny. 

2. Don’t invest more than 30% of your savings. Equally, divide into other modes of investment where there is the least risk. 

3. Don’t follow the trading tips of your friends if they are earning significant returns. You never know at what point and on what day they entered. 

4. Calculate the risk you can take if the stock is in loss and you need immediate funds.

Pro tip: Invest when the market crashes, you will get huge returns after recovery.

Best trading platform

If you want to open a trading account, then you can go with Upstox. Upstox is certified by the market regulator. The account opening procedure is seamless and you will get quality customer service. You can apply for IPOs and mutual funds from the same trading account.

To purchase from Amazon, click here

To open demat account with best broker, click here

Disclaimer: If you want to invest in the stock market, you should consult your financial advisor before making a buying decision. You should assess the risk and study the company details.

Frequently asked questions

Disclaimer: This article is for knowledge only. You have to do your own research before investing.

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