The Great Sale Might End Anytime Now; Should I Buy Stock Now or Wait?

             THE GREAT SALE MIGHT END ANYTIME NOW

As the greatest Hindu holiday approaches, numerous businesses have begun announcing special sales and discounts. Festivals are a terrific opportunity to buy new products all over the world since people wait for these schemes in the hopes of saving money on their purchases. People are anticipating the numerous holiday offers that various brands and stores will be offering as Dashain gets closer in a few days. Consumers have been delaying purchases in the anticipation of earning discounts during the festivals for some time now, which is a prudent financial decision, but I think consumers are missing the bigger sale and discounts that are currently being offered in another market.

Yes, you caught it correctly—I'm referring to the sale currently taking place on the Nepal stock exchange (NEPSE). The last time such substantial discounts were provided was during the covid outbreak back in 2020, and since then, it is being provided in NEPSE for more than two years.

Without a question, now is one of the finest times to buy shares with the long term in mind, but there is also a risk that a swing trade could occur in the near future (perhaps before Tihar rather than Dashain), but if we invest with the long term in mind, we need not worry about the quick swing. We should think like this if we can trade a swing then its good, if we cannot then also it’s not bad.

Right now, the risk-to-reward ratio is excellent and alluring. Also, dividend season is also quickly approaching. After a month, companies will begin to release their first quarter reports, and despite the post-Covid recovery or "worsened" economic statistics, companies appear to be doing well. The prices of numerous stocks have dropped by more than 50% and are close to their 52-week lows, which is preferable to the BOGO (buy one, get one) free offer. Imagine whenever we see BOGO free we get excited that we are getting one same thing free on purchase of a thing or we are getting 2 things for the price of one but the same is happening in the market and we are not enthusiastic about taking the advantage of this situation. Why are people not being able to grab this golden opportunity here? The shares are being offered at such a discount and there is no limit on one’s purchase in the stock market unlike the discount limits and quotas on sale items out there in the general market. Generally, the sale takes place over a fixed period of time and season in the general market but in the stock market it’s quite different, we do not know its beginning and end, and the time frame for the discounts offered is also uncertain. So one should not miss his golden opportunity and buy the shares at such a huge discount based on the mindset, vision, risk appetite, available funds, leverage, etc. we never know when this type of huge discount will be offered again once this sale is over.

Such huge corrections during a bull market are like a great sale that has taken place, whose start as well as the end we do not know. The sale can go off anytime. The optimistic and intelligent investor should not be afraid of the correction but look at the correction as a sale taking place and think it is time to go on a shopping spree and buy ‘good’ shares at great discounts. As we do not purchase clothes or things with defects even if it is offered on sale at a much lower price, we should not purchase ‘bad’ shares only because we are getting them at a discounted price. But before making any investment decision, one must thoroughly study and research, do the due diligence, be well aware of one’s ‘risk appetite’ and try to minimize risks on the investments.

Rojin Joshi - An avid and optimistic investor

Disclaimer: This article is only my opinion and not investment advice, DO NOT make your investment decisions on the basis of this article. Be cautious before investing money in the stock market as it is you who will have to bear the consequences (both profit and loss) of your investment.