Reliance – Dormant Player

Yesterday, one of my friend called and asked me- Boss, Shoo lage che? Ahiya Reliance lai lau? (What is my view on stock market & especially on Reliance).  As my dear friend is Gujarati, so he had obvious attachment with Reliance Industries, and undoubtedly from my childhood I happened to listen many big and flourishing story from Investors of Reliance, and my friend’s father also earned handsome money from the stock, so it was quite obvious that same feeling is imbibed in my friend also.

What I shared with my friend let me share with you guys. A simple chart will tell you more than what I can write here.

Below is attached monthly chart of Reliance Industries, as in itself speaks thousand words than I do.

Reliance Chart

As you can very well see that since from mid of 2009 till June 2011, stock maintained a price range of INR 1150-950 on a downside.  Going ahead, stock moved one step down, range is shifted lower; from July 2011 to till date stock has maintained an upside range of INR 900 to INR 690 on a downside.  This you can very well see in attached chart.  Let me tell you Reliance Industries has significant amount of weight- age in NIFTY and SENSEX ~8%. Now in this scenario, if stock behaves in such a fashion what should be stand of any individual investor?  Answer, is also quite obvious, for time being you should ignore and move ahead.  I know my Gujarati friend is hurt by this statement, but it is an obvious choice to make.  Many of you would counter question me that “If we are long term investor, we don’t mind to hold a stock even for 3-5 years?”  For them, I would only suggest that,

Please Don’t fall in love with your Investments, It is not necessary that what happened in past will happen in future. 

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