The part to wealth creating lies in sensible investing.
Traditionally stock market have been viewed with suspicion
A lot of people have lost a lot of money in trading and speculation of stocks
Speculation is a high risk affair and is different from investing
If speculation is done for instant gratification without having to do any work then it is more like to be gambling
Do not Play with Market!
When you are playing with the market like a gambling game, you are doing the most harmful activity for your present as well as future
Most people are not investors, they just enter in this market without having any kind of knowledge and research material
They just get some tips from TV or some broker, friend or any kind of event related news…
But this is very dangerous for their investment
What provides opportunities for good returns for investment?
There are many wonderful business which have excellent underline economics and reasonably predictable future earnings,
Identifying such business, buying into them at the right time and at the right price and then staying locked in for a reasonable period of time, provides opportunities for good returns for investment
Important things to Consider
- Buying stocks on ignorance… only on the basis of tips, whatever we get from broker, TV, friends, and what so ever without any knowledge of the company… you are investing in is the worst thing you can do with yourself.
- Do your own research, understand the market behavior, the economy, the industry and the company and last the underlying economics of the business
What should you check...
People who have no interest In investigating company’s research reports and who have no knowledge about the fundamentals of the company like balance sheet, profit and loss account, cash flow statements, Financial ratios, shareholding patterns, EPS, dividend history of the company, promoters history, and there records and corporate governance of the company, its peer group comparison and the market trend along with the trend of any specific stock, those people should stay away from investing in those companies without having proper knowledge unless they are willing to teach themselves the language of finance and investing
The Best Advice that I Give you is...
- Avoid stock tips
- Short term market moments
- Television news and Trading analyst’s tips
- And do your own research, understand the market behavior, the economy, the industry and the company and last the underlying economics of the business