The global financial markets are standing on the brink of a steep cliff, with the US economy staring at a possible default.
Whatever happens during the coming week, when the US government decides its future course of action whether it must borrow more or cut its spending, it’s dawning on investors that a major crisis is just round the corner.
So whether or not the US defaults, or the Chinese economy goes downhill, or maybe the European crisis intensifies, times are indeed scary if you are already invested.
Talk about the Indian economy, and things aren’t any rosier out here. Inflation remains high and rising interest rates are choking the growth of businesses.
While there’s some hope (finally) from the government that its moving fast on the reforms front, the actual implementation is what remains to be seen (as always!).
Even the stock markets are limping – the BSE-Sensex was down 525 points this week – while gold continues to shine.
Anyways, here’s a wrap up of what happened this week on Safal Niveshak.
Monday
Know Where to ‘Bang’ To Become a Successful Investor
There is no denying that finding the right stocks to invest is the secret to your fortune. However what most investors do is crystal gaze into the future to predict which stock is going to rise the most, and then make their decisions. While it would be nice and perhaps more profitable to be able to predict those types of future developments, few people can combine the knowledge, ability, and timing to predict and profit consistently from future events. Whether you can or cannot predict the future is beside the point. You don’t have to. What you just need to know is how to profit from studying the present day businesses and then making your stock selection.
Tuesday
Only One Thing Matters When Investing in a Company
The legendary investor Warren Buffett says, “The single most important decision in evaluating a business is pricing power. If you’ve got the power to raise prices without losing business to a competitor, you’ve got a very good business. And if you have to have a prayer session before raising the price by 10 percent, then you’ve got a terrible business.” Do we say any more?
Wednesday
Who Else Wants to Beat The Market?
When you invest your money with a mutual fund, you don’t normally think in terms of losing money. All you want is to make money. And this must be your fund manager’s goal as well, or so you may think. But if you read most mutual fund advertisements and what fund managers boast about on business channels and in newspaper interviews, their ultimate goal is to ‘beat the market’. But what is the problem with this approach? Isn’t sensible investing all about beating the market or earning more money than what some other fund can earn for me? Not really! Read the post to find out why.
Thursday
Can Your Stocks Defeat the Inflation Demon?
Well, that’s what has been the belief all these years. “Buy stocks to beat inflation,” has been the common advice to stock market investors. But just like any stock market advice, this is not entirely true. Read this post to know why I say so.
Friday
What Do You Understand By ‘Risk’ in Investing?
Everyone uses the word ‘risk’ when it comes to investing in stock markets. But ask them what ‘risk’ really means, and you can sense the earth moving from under their feet. The word sounds fancy, and so it is spoken at will to show the sophistication of the discussion involved. But, dear investor, risk isn’t a number. Like a 30% fall in the stock markets, or a 20% fall in your favourite stock. It has a much deeper, yet simpler, meaning, as you’ll understand by reading this post.
Have a nice and safe weekend!
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