Are you looking how to Buy Stocks Now? Try the RCA and RVA Strategy

Firstly I must mention that this post is not for every one. Because you need patience and the ability to understand these very simple methods of buying shares with discipline. If you do not posses both PATIENCE and DISCIPLINE then I think it is better to do something else with your valuable time.

• Interest Rates have started to fall. 
• Election Effect is bringing in a lot of speculation. 
• Prices have fallen disproportionately against valuations.

These key events have taken the Market up from a low of 5199 to the present level of 5870.

Are you looking to Buy now?
Have You started buying and don't now how to move forward?
Have you bought and sold at good profits, and waiting to get in?

THESE STRATEGIES ARE FOR ALL.

Let's discuss RCA first and then move to RVA.

What is RCA STRATEGY?

RCA stands for RUPEE COST AVERAGING.

Firstly you must decide to select your stock.
Then you must invest an equal amount each time you invest into that Stock. Let's say the fixed amount is Rs.10,000/=. That will be the amount you will invest for each lot every time you buy.

eg: 1st Lot - 10k, 2nd Lot - 10k, 3rd Lot - 10k etc.


There are millions of ways of doing this.

Good thing in this strategy is that you will invest a fixed amount each time you buy each lot of shares.

When to buy can be daily, once in two days, every week, every month or any way you want.

Even the amount can be any amount. It is best if you invest something that you will keep adding on effortlessly. Remember it is you who will benefit from this. It is your wealth that will increase, not mine.

In this Strategy you will buy more shares when the price is down, and lesser amount when the price is high.

If the price is 10, and you invest 10k. You will buy 1000 shares. If the price is 5 and you invest the equal amount of 10k. Then you will buy 2000 shares. So you have 3000 shares with 20k. At an Average of 6.67 per share. If you used that 20k all at once, then you would have bought 2000 k at 10, and the average will be 10 per share.

If the price went upto 12.5 the 3 rd time you wanted to invest 10k, then you will buy a lesser number of shares i.e. 800.
After 3 times you will have 3800 for a 30k investment, averaging 7.90.


What is RVA?

RVA is Rupee Value Averaging. It is a very simple strategy to put your money ANY time you want to Buy Shares like the RCA Strategy.

There is a slight difference from the RCA Strategy though.

In RCA we invest a fixed amount every time. In the RVA strategy you invest a fixed amount first and check the portfolio value and decide the amount you invest to have a final total of the fixed amount. If the prices have gone up over and above the invested value and you do not need to add more, then you stop and could even take the gains out.

Let's take the same share prices given in the RCA example and see how the RVA strategy works.

3 share price levels were 10, 5 and 12.50 per share.

So you invest the first 10k at 10. Then you have 1000 shares.
Next time the share fall to 5, as such your portfolio value is 5 into 1000 shares. That is a value of 5000.
Then in order to make it upto 20k, you need to put in 15k, and buy 3000 shares.
Now you have 4000 shares with the 20k that's invested.
Next time the stock price has gone to 12.5, and your portfolio value is 4000 into 12.50 = 50,000/=.
Therefore you do not need to put the next fixed amount of 10k.
Which means that at this point you have only invested 20k and the portfolio value has moved to 50k, giving a gain of 30k.

I do not expect you to understand it when you read it for the first time. I know you need help to understand it.

If you want to know more about these 2 strategies please call me/text me/whatsapp  on 0773219506. Just because you call me doesn't mean that I am asking you to move your portfolio to me.

Please note that my sole intention here is to see you trade and invest to a well thought out plan, and make you move forward with confidence.

There is an excel working on both these strategies(I do not want to share it on google sheets). If you are interested to have it please send me a mail to saliya@capitaltrust.lk. I will be more than happy to share it and also help you to understand it and use. Send me the mail with the following heading : RCA vs RVA excel sheet.

Finally I think I explained the strategies and said will go out of my way to make you an informed trader or investor. If you have read thus far and yet do not want my help, I do not know what to say.