Why do you ask to select market dates for Sensex?
Sensex is a barometer of Indian stock market and is known benchmark all over the world for comparing equity returns across many countries.
What is the purpose of asking one peak date and two crash dates for Sensex?
One of the foundations of MySmartStocks.com is to have investor sleep peacefully in the night even when market crashes. Because no one is risk averse, everyone is loss averse, we find market crashes far more important than peaks. Therefore, you will hardly find an investor discuss about his/her losses than his/her gains.
Which date should be selected as Sensex Peak date?
We list about dozen market peaks since Jan 2008. You may select any of those dates.
What is the significance of selecting the Peak date and how does it impact the investor?
When all favorable economic conditions co-inside (whether it be GDP growth, Industrial production numbers, unemployment rates, company quarterly tax payments, earnings declaration and so on), market welcomes and represents it positively. Therefore, you should select a proper date when Sensex had peaked in the past. We provide past 12 such peaks for your convenience. You can also choose an intermediate Sensex peak date. Selecting proper peak Sensex date allows investor to find out only those stocks which are relatively stronger than Sensex.
Which dates should be selected as Sensex crash dates?
These could be any of the Sensex crashes since Jan 2008, market lows during last 36 months or intermediate market bottoms. For your reference, we list these important dates where market has crashed over 500 points since Jan 2008. You should select dates which are important and eventful. For example, a crash date could be 24 Oct 2008 when market crashed by 1071 points due to collapse of Lehman Brothers in US.
What is the significance of selecting Two Crash dates and how does it impact the investor?
When all unfavourable economic conditions co-inside (whether it be bad earnings, reduction of economic activity, sluggish growth rate, high unemployment, and so on), market reacts to this negatively. You as a prudent investor should be able to determine those winning stocks which survive such crashes even better than Sensex. Since every crash has a different reason attached to it be it global vs. domestic meltdown or micro vs. macro crisis, unforeseen circumstances and so on, we allow you to select two important stock market crash dates important in your opinion. By providing two crash dates, MySmartStocks.com ensures that winnings stocks have survived better than Sensex at both times.
For your convenience, we provide list of such dates when Sensex crashed over 500 points since Jan 2008. You can also choose an intermediate market bottom date, if you wish. M
What does selection of three dates achieve?
It determines your selected analysis time range from oldest to the current date and this range is used to find winning stocks.
Do I have to select different weights for these three dates?
You can keep equal (33.33%) weight for those dates (one peak and two crashes) allowing importance of those three dates equal.
However, if you are one of those financial wizards and if you feel to assign different importance to different dates due to its historic relevance and importance, you may consider different weights for intelligent analysis and find winning stocks accordingly. For example, you may consider assigning Peak date of January 8, 2008, Crash date 1 of October 24, 2008 and Crash date 2 of March 6, 2009 weights 20%, 50% and 30% respectively, this way you can assign higher importance to crashes and accordingly find winning stocks.
What is the benefit attached to 'Equal Weight' criteria to peak and crash dates?
If you as a smart investor rate significance of a historic event differently compared to other people, you can definitely assign different weights and find resulting winning stocks. For example, if you consider market crashes (or survival) compared to Sensex of higher importance than market peaks, you can assign say 20/40/40 weights or 10/50/40 weights to peak/crash1/crash2 dates.
What is Quality Filter? And how does this benefit holistically?
It is a MySmartStocks.com mechanism to filter the winning stocks (Top 2%) from the Indian stock exchanges(BSE and NSE) which are stronger than Sensex for given percentage of your analysis time duration. Stringent you become, shorter the list gets and longer it takes to find out. Smaller the filter number you choose, relaxed it becomes and you get the larger list of winning stocks. We suggest you choose 70% to find higher number of winning stocks.
Why one needs to do Comparison?
Comparison allows you to set your own time range for doing what-if performance analysis. Based on your chosen Peak, Crash1 and Crash2 dates and quality filter, MySmartStocks.com finds out winners and these winners are now compared for their performance in chosen comparison timeframe.
What is the significance of Comparison?
To carry out your own what-if analysis in your chosen timeline and find winning stocks. It is impossible for human mind to do such heavy analysis on daily basis.
What benefits are attached to Comparison?
1) Find out performance of stronger-than-Sensex quality stocks in your own time range
2) Determine prudence of your past decisions
3) Compare your portfolio returns made during certain time interval with MySmartStocks.com winners
4) Getting ready to reshuffle your portfolio, if necessary