The winning ways of women investors

Stock markets are no longer a male preserve. Women investors are now carving a niche for themselves, trying their hand at everything — from the tried and tested long-term investing to the excitement of futures and options trading.

What does it take to strike it rich in stocks? Here is what some successful women market players have to say.

Meet Krishna Mehta, a home-maker in Surat, who has been an active investor for two decades. “A new stock exchange was started in Surat and my father, a card holder, encouraged me to write the stock exchange exam in 1994,” says Mehta. Since then she has been in the market “without taking any breaks”.

Mehta says the excitement of navigating the many up and down cycles has been “very nice”.

She takes the job of investing very seriously. “I follow the market on TV, go through annual reports, read the newspaper, discuss with friends and also look at tips from brokers,” she says.

Her outlook is long term and she sticks to companies with strong fundamentals and growth prospects. She has made a whopping 60 per cent annually in the last few years; beating many hardened fund managers at this game. Her current picks include L&T, ACC, Hero Motors and Biocon.

“The market does not always move on fundamentals,” she cautions. “If you have done your homework, don’t get stressed when the price goes lower.” This leads to over-trading and missing the real upside in the stock.

Her experience has been that it takes time for the fundamental strengths to unfold and hence one has to be patient.

However, in case her original assumptions do not pan out, she does not hesitate to book losses. “I sell if the stock hits my stop-loss limit.” This discipline along with her studious book-keeping has helped her become professional about investing. Besides her family’s money, she also invests for her father and daughter.

It is all work and little play for Mehta. “Any money I get, I want to invest in the market, rather than spend it on kitty parties.” And her investments are paying off well. “I have bought expensive gifts for my husband with the profits I made,” she adds gleefully.

While Mehta prefers to dial and trade, Nisha Shroff is an online investor who prefers futures and options (F&O).

She has stuck to the stock market despite making “super losses” in her initial years, trying her hand at trading online.

“I first started investing in a mutual fund when I just finished my tenth standard, in 2004,” she recalls. Her family in Mysore had no background in investments and she learnt the basics all by herself. “I asked for a capital of a mere 30k then from my mom, but she refused. My aunt then helped with my first investment,” she reminisces.

Her real break came in July 2010, when she enrolled for short courses on technical trading at the Manipal Institute in Bangalore. She took a six-month break to understand charts and did paper trade to try out what was learnt and also did a course on fundamentals and F&O. “After understanding various aspects of these products, I started trading Nifty futures.” Studying technical analysis has made her “mature on how an entry is set, when to sell and most importantly, where to set stop loss,” she notes.

While knowledge is good, one needs to verify the credentials of the institute or person offering the course before enrolling. “Some classes are just exorbitant,” she cautions.

Shroff, a designer who is in the garment business, feels that trading is a “business like any other” if done with proper knowledge. Just speculating because you think “this could go up or that could go down is gambling”, she asserts.

She started with a capital of around ₹3 lakh about three years ago and has averaged monthly returns of 3-5 per cent.

“I withdraw an amount for myself every month and reinvest the rest.” For anyone new entering the market, she suggests starting with a minimum of ₹10,000. She advises that they do paper trades and hold to the entry, exit and stop loss limits.

Still, keeping up with the market does not mean that you should “sit in front of the screen all the time,” Shroff points out. “At the end of the day, spend may be an hour on chart study to know your entry, exit and stop loss,” she suggests.

She also uses free tools such as Chartnexus to analyse price charts. The smart phone app from her brokerage Zerodha is also helpful to place trades on the move.

While F&O brought fortunes to one woman, it turned out to be a ‘disaster’ for Chitra Nagappan, a financial advisor who tried her hand at this a few months ago.

Nagappan has been a buy-and-hold investor since 1992 and recounts her experience when she switched her strategy as she was attracted by the low investment needed for F&O.

“I took a position in NTPC in the F&O segment at around ₹126 levels in December 2013. But as there was not enough price movement, I closed the position just before elections, around my purchase rate — resulting in a no loss-no profit trade. Post elections it went up to ₹165 and yes, it still rankles me.”

Her takeaway from the experience was that her “nature and psychology is well suited to invest steadily and wait a fair amount of time to see the returns.” So, she now prefers to go the “slow and steady” way.

In general, she finds women investors to be more focussed, disciplined and they “stick to the plan” compared with men who “churn their portfolio often.” “Women can multi-task; they are good planners, implementers and executors and so best suited for the markets.”