Defer stock-specific decisions for now, be cautious with contrarian bets

Cost averaging, contrarian bets and taking margin funding should be strictly avoided

Recently, Zerodha, an online stock broker, studied the holdings and positions of its clients as part of its risk-management strategy. And the results weren’t awe-inspiring. In the case of Yes Bank, 200,000 of its clients held the stock with 59 per cent of unrealised losses. The total number of investors on its platform who held the stock was 700,000. Worse still, around 200,000 had bought the stock four times on an average, clearly indicating that they were trying to do cost averaging. The stock had hit its 52-week high of Rs 285.90 on April 4. At present, it is trading