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Did you listen star anchors of different business shows for the past 15 days? All were unanimous in their views about impending world slow down and their view on sensex that would go down all the way to 4000 before we can expect any recovery. Suddenly they all are changing their colour. Now they are talking about over bear reaction and attractiveness of our market. Though I didn’t differ much about the attractiveness and present valuations of Indian Stocks of select sectors, I didn’t believe complete decoupling of Indian Economy from World economy. US economic problems are ever increasing. It is the first time in World history, most of the informed economists are suspecting the ability of a super power Govt. to save it’s economy from tumbling. This crisis of confidence would do much harm to the economy than the actual problem. Indian market is longing to go down rather than go up. When a new set of bad news comes out from global markets (like credit card default – Imagine a bankruptcy news of either VISA or MASTERCARD ) we may expect even further accelerated crash. ( I don’t expect the actual bankruptcy of either VISA or MASTERCARD, but any rumors about their financial health would collapse world trade for a considerable period) .

Hence my argument is that don’t put all your money know. Commit only 10 – 15 % of your capital know. Invest only in top three to four stocks in each sector. Don’t invest(?!) in penny stocks. Do your own research and invest. SIP would work well in this falling market.

My stock picks for this month are : RCOM, Axis Bank, Punj Lylod, Cairn Energy, Reliance Capital, SUN TV, Gujarat NRE, 3i infotech, Polaris, JP Hydro. Place stop loss.

Don’t invest or trade in UNITECH. Cash is the king.