Are you listening to Noise or Voice ?

W. Edwards Deming once quipped “In God we trust. All others must bring data.”  It stressed the importance of data measurement and analysis while doing analysis. Edwards Deming was a statistician and he knew the importance of data. In fact, investors need data points which can be used to exploit the market. Take for example the data we provided to you over the last 2 weeks. We repeatedly reported about the   total approximate earnings of Indian Railways. From 1 April to 8 October 2022 was ₹33476 crore, Indian railways experienced an increase of 92% in revenue compared with ₹17394  achieved in the same period last year. Probably some of you are bored by this data as investors don’t know how to use this piece of information to exploit the market. 

 

Let’s check how we could have made use of this data with a few examples. Ircon gained 32.31% in just a month’s time while Rail Vikas Nigam Ltd gained a whopping 62.96% during the same period. More importantly these stocks are not illiquid stocks and at any point of time they were trading with a volume of several crores per day. That means the stock is not manipulative in nature.  And remember it's fundamental data and not technical data. 

 

Exploring the opportunities with data may appear to be more an art than science. However when you include data it’s more of a science than an art. The more we train ourselves to read the simple facts the more we gain. Unfortunately investors waste their time on social media and look out for details. If we can’t exploit the market with this simple data then why should we search for more data points?.

 

 Investor’s should think twice before wasting their time on media but they usually surrender for noise than for voice. 

 

 Market is like waiting in a bus stop, if you miss one bus , don't worry the next bus will be coming and be ready to board with conviction.

 

PS: 

 

For those of you who ask if it’s still a good opportunity to buy these stocks mentioned in the newsletter, please don’t be in a hurry to buy them. Everyone is chasing these stocks now. They are in overbought mode and we can expect a sharp correction from here.