You have some money in your bank. You decided to invest some money in the common stocks. You have reached on this decision as you want to have more income than if you would these funds in other way .History might be irrelevant to most of you but we compare the returns by looking at the past. It’s more fun and interesting to find some excellent companies in the market. Valuations may matter but that’s secondary to identifying the top-notch business. Here are some questions by Philip A. Fisher that will help in identifying the common stock with uncommon profits :)
- Does the company have products or services with sufficient market potential to make possible a sizable increase in sales for at least several years?
- Does the management have a determination to continue to develop products or processes that will still further increase total sales potentials when the growth potentials of currently attractive product lines have largely been exploited? View full article »
It’s been observe that people find investing as one of the difficult task. Either they end up depositing all their savings in fixed deposits, gold or they become the scape goat of ULIP (insurance).
Moving on to some quotes on the investing and financial markets that might change the perception of yours. There isn’t right and wrong, there is two sides to the coin, but rich dad exists on only one side of the coin, the business and investor.
Yes, there is some risk involved with investing, and it can be scary. But if you don’t take control of your cash and moves forward you, well those are famous ones from Rich dad -Poor dad. View full article »
The Atlantic published a challenging article on the decision-making abilities of financial experts, I like the arguments and the study outcomes are not surprising to me ;)
There are experts, and then there’s everybody else. In finance, experts have studied the subject and follow the markets closely, so you’d expect that they’d be superior at betting on the stock market as well as on other financial matters, right? Well, perhaps not so much. As the psychologist Philip Tetlock—who did a 20-year study on the subject—famously said: Experts are poorer at predictions than dart-throwing monkeys. Study after study has shown that low-cost index funds—investments that track major financial market indices—outperform “actively managed” mutual funds.
The question of mutual-fund managers’usefulness is hotly debated, with one study showing that only 24 percent of professional investors beat the market in the long run. If studies don’t convince you View full article »
History shows that mutual fund investors generally increase inflows after observing periods of strong performance. They buy at high prices when future expected returns are lower, and they sell after observing periods of poor performance when future expected returns are now higher.
This results in what author Carl Richards called the “behavior gap,” in which investor returns are well below the returns of the funds in which they invest. Perhaps with this observation in mind, Warren Buffett once said, “The most important quality for an investor is temperament, not intellect.” View full article »
Continuing from the last post on predicting the market from: the words by John Templeton “Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria.”
You can’t wait to time or predict the market, today is the best time to start investing if you have cash. Cash is a strategic asset.
The sense of pessimism is prevailing all over. Generally speaking the lifespan of investment remain for 30-40 years and to get the opportunity window for investment is bit difficult. Analyzing the Sensex in the last 20 years there has been 3-4 opportunity windows. View full article »