Investing Behaviour

Weapon of Mass ‘Temptation’ that Destroys Stock Market Investors

Have a look at this balance sheet…but first stop looking at the left side of the image. 🙂

Well, if you can’t read the numbers above and want to have a “better” look at the complete annual report of this company, click here to see…but please come back to this post soon! 😉

“Isn’t it an amazing annual report?” This is what an ex-colleague asked me showing this annual report sometime in 2009.

3 Big Risks in Value Investing – Part 1

“Who would join a Facebook chat around investing on a bright Saturday morning?” I asked myself while preparing for the latest session of Safal Niveshak’s Facebook Jam on June 9.

I opened the session for questions at 9 AM, but the first question came only at 9.16 AM. So my fears were coming true. But then, the speed at which people came in and the intensity at which the discussions progressed, it was an amazing feeling by the time the jam ended at 11 AM.

Click here to read the transcript of the jam. The next session will be held on coming Saturday, 16th June, between 9-11 AM.

Anyways, the reason I’m talking about the Facebook Jam is that this is one platform where I’ve encountered the best questions around investing over the past four weeks since it all started.

Like in the last session, one of the avid readers of The Safal Niveshak Post asked, “What are the risks involved in value investing?”

Opto Circuits, and Power of Story in Investing

Power of Story If you clicked on the headline expecting to read my view on Opto Circuits, I’m sorry to disappoint you because this post isn’t about that.

The reason I mention Opto Circuits here is because I have received several emails over the past few days requesting for my view on the stock.

Given the number of requests for this specific company, I would definitely work on the same and try to release a report soon via StockTalk. But what intrigues me is – Why are so many people suddenly talking about a small-size company called Opto Circuits?

What’s the story?

Well, that’s what I’m going to discuss today – investing and power of “the story”.

Is this a Good Time to Be a Value Investor?

A reader of The Safal Niveshak Post sent me this email yesterday…

For the last few days, one question is worrying me. As a value investor, even if I choose value stocks after thorough analysis of the business, how do I factor in general macro-economic environment, global slowdown, etc.? How do I know these macro-economic factors will not keep markets subdued for years to come? How do we identify if it’s not great depression again?

Just to add, is there a wrong time for value picking, or is it always the right time as long as there’s thorough analysis and sufficient margin of safety

Very important questions, I must say.

Traditionally, value investors have tended to ignore macro-economic issues and have focused on bottom-up investing.

An Open Letter to My Daughter

My dearest Kavya,

These past seven-and-a-half years seem to have gone by like the blink of an eye.

You’ve gone from a newborn princess cradled in my arms to a small princess experiencing the joy and independence that life can bring.

I can still recall the moment I got the news of your birth. I was not by your side then, but I felt like the happiest father on earth. Your mother and I marveled at your red cheeks, wrinkled fingers, and your intense eyes.

Your birth gave me the experience of my lifetime…an experience that holds the most precious place in my heart.

Some Advice for the Young…and Broke

Young and Broke I generally don’t like offering advice on this platform – Safal Niveshak is all about sharing my experiences and learning as an investor and manager of my own money. So the headline of this post seems a bit awkward to me.

But then, what follows is my response to some common claims that I’ve heard from a lot of well-educated and confident (yet broke) young people…and I was one of them a few year back. (I’m still educated and confident, but have taken care of that ‘broke’ part :-))

Here are some things I’ve been hearing all around from the young with respect to their careers and finances, and my thoughts on their thoughts…

Psychology of a Stock Market Loser

Here’s part of a conversation I had last weekend with a friend who wanted me to help him out with his loss-making stocks. Let’s call him Rohan.

Me: Why are you so depressed?

Rohan: I hate my stocks.

Me: Oh, another member of the pretty big ‘I hate my stocks’ club?

Rohan: I’m sick of looking at my stocks. And given that the markets are falling, I haven’t looked at my portfolio for days!

Me: What stocks do you own at the moment?

Rohan: Don’t want to show.

Real Life Story: How to Increase Your Savings by 9200%

Most queries I’ve received on Safal Niveshak over the past ten months have been from young men, either newly married, or already with one child. And most of their questions have revolved around…

How do I start saving and investing money?
How do I plan for a well-structured financial life?
How do I meet my life goals?

While I have responded to these queries, here is the real life story of a close friend (let’s call him Ravi) who was in the same fix almost 9 years ago, how he has been progressing well towards his financial goals (at least what it seems as of now), and how he has grown his savings by a massive 9200% over four stages of his life.

Start Worrying about Your Personal Finances. Seriously!

Last Saturday, I was amongst a group of young architects (age-group of 25 to 35), lecturing on the art of managing one’s own personal finances, and the need to start saving and investing as early as possible.

Lecture on Personal Financial Planning at DesignWorks

At the end of it, I asked them, “So are you worried after listening to what I said?”

Some were surprised to hear this. “Worried? Why?” one of them asked.

“Indeed, I am very worried!” said another.

“Worried, and excited,” said the third.

Investor, Do You Know Where You Are Going?

“Would you tell me, please, which way I ought to go from here?”

“That depends a good deal on where you want to get to,” said the Cheshire Cat.

“I don’t much care where…” said Alice.

“Then it doesn’t matter which way you go,” said the Cat.

“…just so long as I get SOMEWHERE,” Alice added as an explanation.

“Oh, you’re sure to do that,” said the Cat, “if you only walk long enough.”

~ Lewis Carroll, Alice in Wonderland

This discussion from Alice in Wonderland says a lot about how we keep trying (keep walking) when we are aiming to get somewhere, or achieve something, in life (like financial freedom).

But then, let me ask, when it comes to your financial and investing life – “Do you know where you are going?”