Volatility Woes

It was the best of the times, and it was the worst of the time! Volatility in the current choppy markets signifies both worst and best of times. With all the proponents of MPT (Modern portfolio theory with the Betas and Alphas) who really abhor the term citing it as "Risk" will advocate us to stay away from the markets. However, like all value investors, believe volatility helps people who help themselves. Long term investors who have done their homework well will find some discounts, albeit not with higher margin of safety, but high enough to start building their starter positions.

There are very few stocks which are available at good discounts. One of this is Balmer Lawrie &Co. which has one of the best balance sheets among the Indian corporates, offering a 4% dividend yield, and has EBITDA of Rs.110 cr at Mcap of Rs. 900 cr without any debt and cash of Rs. 250 cr. You will find this kind of value buys in market turmoil, but getting these at the current market levels will help to build a strong portfolio of companies.

Disclaimer: Guinea Pigs should try to do their own analysis to make an informed decision. I have a postion in this stock