Back from the long Diwali holidays, time to reboot on the markets, long breaks are always good to revive and get some thoughts from your near and dear ones.
On the way back from Bhopal to Mumbai, some fellow passengers were curious about the markets and the train was late as much as 6 hours. It was a holiday special train and passengers paid a premium to board the train compare to other routine trains, they expect the train to come on time as the fare is higher. I did exchange few tweets with the railways department for delayed train.
Getting back to the theory as the fellow stranger passengers did not have a good time with markets as well, most of them were trying to time the market. Continue reading “Rebooting from the Risk – Return and Disappointment theory”
Self-deception is costly when it comes to investing. So let’s consider some of the lies that a lot of us may be telling ourselves and the impact they may have on our portfolios.
You know what your investment returns are. You would be surprised at how few people actually know what their returns are. Even fewer understand their performance relative to a benchmark.
Here are some hilarious thoughts when you say and what does it actually mean:
1) That’s overbought (I’m not long and think buyers are stupid)
2) That’s oversold (I’m long and think sellers are stupid) Continue reading “Market Forecasting and Convictions”
Extraordinary returns follow extraordinary discipline. Discipline in buying and selling, and maybe the most important one of all, holding. Developing the conviction to hold is something that I’ve learned over time. It didn’t come easy. The basis of this article is to give some insight on how to develop the conviction to hold your winners. It is very tempting to sell along the way, and it’s okay to take a little off the table, but the big money is made by holding.
“It never was my thinking that made the big money for me. It always was my sitting.” — Reminiscences of a Stock Operator
Many of us, myself included, look at stocks that have made big moves and think to ourselves, “If I would have only knew about that company and bought it back then.”But would you really have developed the conviction to hold during the run up? The problem is that to achieve a multi-bagger in the portfolio, you have to hold a multi-bagger. And if you want it to change your life, you need to hold a lot of it. Continue reading “Patience is Power – Market Convictions”
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? Continue reading “Common Stocks and Uncommon Profits”
Equity investing is something that can’t be taught or learned in a limited period. It requires time, patience and rules that you can bank on. I shared few principles from the famous book Beating the Street by Peter Lynch few days back. At the end of the book Lynch shared 25 Golden Rules of investing: (Which is interesting because I count 26)
- Investing is fun, exciting, and dangerous if you don’t do any work.
- Your investor’s edge is not something you get from Wall Street experts. It’s something you already have. You can outperform the experts if you use your edge by investing in companies or industries you already understand. Continue reading “Why you should invest in Equity Market”