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We discussed the importance of reading annual reports in the past two posts.
We also briefly discussed the importance of reading financial statements that convey the language of business.
Now here is a small quiz for you – What is that one thing you look for in a company’s financial statements?
Is it to know how much a company is leveraged? Is it to know how profitable the company is? Or is it something else?
[Read more…] about Warren Buffett’s ‘Secret Holy Grail’ to Successful Investing
“How can this be possible?” you must be wondering.
Indeed there’s a way – and you can get a lot of hints from this on whether to junk the annual report, or to explore it deeper.
Well, let me have this video do the talking.
In this video, I also talk about 8 warning signs you must watch out for while glancing through an annual report.
[Read more…] about How to “Read” an Annual Report in 5 Minutes
If you have been an investor for long, you must have heard about Jim Rogers.
Rogers is a leading global investor and commodities guru, and has an amazing track record over the past few decades.
When someone once asked Rogers what was the best advice he ever got, he said it was the one he received from an old man in an airplane.
[Read more…] about Simplest Trick to Outsmart 99% of All Investors
“And in the end, it’s not the years in your life that count. It’s the life in your years.” ~ Abraham Lincoln
It gives me great pleasure to share with you, dear Safal Niveshak tribe member, that today marks the completion of the first year of Safal Niveshak (my third child :-))…an initiative of empowering you to become independent, sensible, and successful in your financial life.
It was on 9th July 2011 that I stepped into the unknown, fearful of what destiny might bring for Safal Niveshak.
Today, as I pushed the “publish” button for the 276th time, I looked back at a wonderful journey filled with excitement, immense learning, new relationships, and creation of lifelong friendships.
Dear Small & Irrelevant Investor,
You must be surprised to receive this letter from me – the ever-so-busy Stock Market Analyst working for your friendly, neighbourhood broker.
But you see I have been enjoying some free time these days because the markets are weak and people are not buying stocks, and thus not reading much of my recommendations.
So here I am, sparing some of my precious time writing to you. I am heart-broken reading all the maliciousness that is being spread these days about me, and my graceful profession.
I’ve even heard that there is this guy called Vishal Khandelwal who’s running this funny, charitable, new website called Safal Niveshak (sounds similar to “Suffer Niveshak”! Ha-Ha-Ha!) and is trying to throw a lot of s**t on my work…but I’ll handle that later in this letter.
[Read more…] about An Honest Letter from Your Friendly Stock Market Analyst
Here is what a Safal Niveshak tribesman, Sanjeev Bhatia, wrote in the latest Facebook Jam last Saturday (sorry Sanjeev, but it’s your turn to claim the fame ;-))…
I have a particular Behavioral Problem. You recently wrote somewhere that pain of seeing your picks down 15% is more intense than pleasure of seeing your picks go up 15%. But in my case, it seems to be different. I am now seeing BHEL going up to 232 level, did not buy at 200 because my buy price was 180. Opto Circuit, my buy price was 140, it bounced back from 147 to 155…and with market going up and in strong upward momentum, it does not seem likely to come down soon although you can’t say that with certainty in this market. How to let go off this “being left out” syndrome?
What Sanjeev thought, and as I understood from his question, was that he was suffering from a “unique” behavioral problem – something like the “Alice in Wonderland Syndrome”, which is a neurological disorder that can effect a person’s perception.
But then, as I mentioned in the jam, and experienced investors would vouch for this, is that Sanjeev suffers from nothing more than a “common cold”, like most of us investors.
“If I have seen further it is by standing on the shoulders of giants.” ~ Isaac Newton
It goes without saying that if the world was minus Benjamin Graham and Warren Buffett, the idea for Safal Niveshak wouldn’t have existed as well.
Graham and Buffett have put enormous number of ideas into my head, which I have been sharing with you ever since Safal Niveshak was born. Reading their work had made a lot of difference to my life as an investor and human being.
However, there is one more person whom I’ve never mentioned on this platform, but who has been a great influence on the behavioral side of the analyst within me.
[Read more…] about Do You Want to Meet One of India’s Best Value Investors?
“What are you looking at?” my wife asked while staring at me.
“N-n-nothing dear!” I said. “I was just reading on a company.”
“All you guys are the same!” she said while rushing out of the room without even giving me a chance to explain.
“I knew this would happen!” I said to myself while turning back to that website of…Lovable Lingerie Ltd. (LLL).
I was looking at this company after a long-time reader of The Safal Niveshak Post, Nitin Shetty, asked me how he should go about researching this company and whether this could be the “next Page Industries” (the company behind the “Jockey” brand of innerwear in India).
[Read more…] about Is this Stock the “Next Page Industries”?
Here is what a Safal Niveshak tribesman, Mr. Ramanand, wrote as a comment on my previous post…
“Reading all this (article and comments), as well as various traps such as “Growth Traps” and “Value Traps”, is it any wonder that the Stock Market is just a bunch of “traps” to any investor without a specific edge over others? Specific edge can be things like insider information, front runner, market operator, full time disciplined trader etc.
I just read an article in Yahoo today on Macro vs. Micro by Deepak Shenoy. This is another nail in the coffin of any person wishing to invest his hard earned money into the stock market. If even value investors cannot do a reasonable analysis due to so much uncertainty, is it any wonder that retail participation in the equity markets is declining day by day?
So now, on top of concerns like share price/value, market capitalization, company position, pricing power, market share, growth rate, EPS/ROC/ROE, and management competence….you have to additionally deal with unethical management, corrupt auditors, fudged balance sheets, fake earnings, hidden liabilities…and *NOW* you also have to worry about dollar exchange rates, govt inaction and policy about-turns, oil price shocks, terrorist attacks (both domestic/elsewhere), diplomatic relations *between* foreign countries (India may not be involved at all), Spanish Interest rates(!??!), Greek Utility companies payments (?!??!) and what not.
I’m beginning to wonder whether it is worth remaining in the Markets! Wouldn’t I be better off investing my savings in tangible assets (to protect against inflation), suspend my recommendation services, close my demat/trading account, and stay away from the stock markets for good (of course not making the mistake of coming back just because they went up after a year).
What do you say Vishal? Is this a real possibility now?
Mr. Ramanand, here is my humble reply to your observations, doubts and questions, which I believe must be shared by a lot of other investors as well.
Here’s my presentation titled “The Return of Uncertainty”.
[Read more…] about The Return of Uncertainty, and How You Can Deal With It
Have a look at this balance sheet…but first stop looking at the left side of the image. 🙂
“Isn’t it an amazing annual report?” This is what an ex-colleague asked me showing this annual report sometime in 2009.
[Read more…] about Weapon of Mass ‘Temptation’ that Destroys Stock Market Investors