Building a stock portfolio with expert recommendations

The past few months have been very interesting ones for the Indian markets. Most people will agree that the valuations of a large number of stocks were stretched and unsustainable, so the correction, though brutal, have had the benefits of bringing down the markets to levels where one can look at investing. The mid cap and the small cap space may well witness more pains, even though the large caps seem to have stabilised for now. The quarterly results were largely good, though not spectacular, and with the festive season falling in Q3 it can be expected that the current quarter results will be good. Is this the time to build a portfolio for the future then?

In my opinion, if you do not have a stock portfolio now, it is a good time to start building one. Several stocks are available at attractive prices and present a great opportunity of handsome gains between this Diwali and the next. The important thing is to pick the right stocks so that the portfolio is a high performance one. In this regard it is best to go with professional recommendations, even though you must do your due diligence to ensure you are comfortable with the stock in your portfolio and are broadly aware of the risks that are associated with the stock.

I have been following a lot of recommendations over the last 2 weeks and have come up with this selection from different experts, both from Fund houses and brokerage houses:-

  • Birla Cable
  • Engineers India
  • Escorts
  • Federal Bank
  • Heidelberg Cement
  • Hindustan Oil Exploration 
  • Himadri Speciality Chemicals
  • ICICI Bank
  • L & T Finance Holdings 
  • NALCO
  • NBCC
  • Petronet LNG
  • Sonata Soft
  • South Indian Bank

You can start investing in these with the basic rules in place – buy in small lots, stagger your purchases, be aware of important events such as state election results, be in cash to take advantage of sudden market changes etc. If you have 5 lacs plus to invest, you can look at the next 4-5 months to put your money in. With a lower amount, look at the next 2-3 months and invest in fewer stocks, not the whole lot.

A disclaimer here will be in order – I have a few of these stocks and am actively considering the option of adding the rest to my secondary portfolio between now and end of the year.

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