Must Read Before Investing

* If you get the conviction to invest Rs.1 lakh in a stock, then only invest in that stock, else forget that stock. Do not invest just for the sake of investing or to try your luck.

* Before buying any stock, write down the reasons why you are buying that stock and before selling review those points that you have noted down, then take a decision to sell.

* The trick of successful investors is to sell when they want to, not when they have to...

* One quick test is to imagine that you had to give a presentation on a stock that you want to buy to a room full of savvy industry veterans and then take their questions. If you could not do it, may be the purchase is not such a great idea.

Saturday, October 27, 2012

Behavioral Finance

  • There is no way anybody can say that this is the right way to do it and that is the wrong way to do it. It depends on what will work. 
  • Another naked truth is that stock markets are designed to reallocate money from DUMB people to SMART people.
  • Thus investors with small pond of KNOWLEDGE and oodles of DISCIPLINE and PATIENCE are likely to see money flow their way over time ---I think that's
    how stock markets are designed to work.
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