Bull or Bear, Long-Term Investment is always the Winner (Exclusive SS Pro Analysis)

~Rishab Agrawal

In the last five years, NEPSE has seen a run of bull market as well as bear market. Over this period the prices of stocks of all the companies have fluctuated immensely creating new highs and lows in terms of stock prices. This volatility affects the investors’ value of investment and manipulates their buy/sell decisions. For instant gains, traders tend to buy when the market is falling and sell when the market is gaining. But if we overlook the volatility of the market and think about the growth of the investment in the longer run, will it be beneficial? Will our investment grow despite the volatility of the market? The answer is yes, it will.

Using the recently launched software SS Pro, we can calculate the growth of our investment as per the latest data. SS Pro’s Investment Worth shows the present value of investment that was invested on some past date in a particular company. All we have to do is feed in the name of company, value of the investment and date of the investment. In just one click, SS Pro will calculate the present value of the investment and show the complete growth from the time of investment till the present day. This calculation also includes all the bonus shares and cash dividend received since the day of investment. Further, it assumes that the right shares issues by the company in which investment was made, was applied for by the investor. In this way, complete growth of the investment can be known leaving no stone unturned. Here is an exhibit of the investment worth calculator:

(Picture taken from SSPro)

Coming back to the issue of investment in the long run, we have assumed that an investor invested a sum of Rs.100,000 in each of the following companies on 10^th September, 2013. Let us see how much the investment has grown in a period of five years and what is the present value of the investment.

We assumed the date of 10^th September, 2013 because since that date, NEPSE has seen both- bullish trends as well as bearish trends and the prices of the shares have fluctuated to new highs and lows. From the table above, we can see that investment of Rs.1 Lakh in each of these companies has resulted in annual return of more than 20% which is more than the average rate on fixed deposits provided by commercial banks in the last 5 years. This also shows that despite a volatile market an investor can realize higher returns in the longer run. The only thing to be careful about before investing is quality and prospects of the company. If the company has satisfactory past record and strong future plans, the investor can invest in the company and turn a blind eye towards the volatility of the price of share for a couple of years. However, being updated about news regarding the invested company will be in the best interest of the investors. Patience is key for good returns out of investments.

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