Friday, June 25, 2010

Goden Rules

Dear Readers,

It is a time-honored theory and success mantra as the share market investment should be with a long term vision. Every one of us knows this hypothesis but very few percentage apply this tactic with an addiction. I am sure that short term/intra-day gaming will never make anyone prosperous or the final results will probably of negative, or in general, it will bring you back where you started. Today, I wish to quote few my favourite, Sir John Templeton’s 16 Rules of investing for readers. Don’t consider these lines as usual or as just interesting quotes, instead these are the essence of experience of an investor legend shorten in precious words.

1. If you begin with a prayer, you can think more clearly and make fewer mistakes.
2. Outperforming the market is a difficult task.

3. Invest !.. Don’t trade or speculate.

4. Buy value. Not market trends or the economic outlook.

5. When buying stocks, search for bargains among quality stocks.

6. Buy low. So simple in concept.. So difficult in execution.

7. There’s no free lunch. Never invest on sentiment. Never invest solely on a tip.

8. Do your homework or hire wise experts to help you.

9. Diversify – by company, by industry.

10. Invest for maximum total real return.

11. Learn from your mistakes.

12. Aggressively monitor your investments. Remember, no investment is forever.

13. An investor who has all the answers doesn’t even understand all the questions.

14. Remain flexible and open-minded about types of investment.

15. Don’t panic.

16. Don’t be fearful or negative too often.

Equity investment is one of the riskiest segments in the whole kind of investments and you must have self convinced on the risk factors before you enters. You should have measure your own financial/emotional levels before entering in such a playground. You have to be a mindset to take things in a cool way even the sensex touches again 8000 levels. But its only possible when your selected stocks are best in their respective businesses.

Few People who capable to move with the fast moving market trends can only make gains in the same day or in short term trading. The game is highly hazardous and not for the common man. Majority of us shifting to long term investment after suffered considerable burns from the intraday/short term deals. This shift is mostly not on the basis of improving strategies, but cause of limited options. My experience says, a person who has worthy experience in long term investment can perform better in the short term games. Or it is better you start with the patience game and gradually reducing the time frame from the experience you gained or the knowledge you acquired.

Happy investing & regards

Shabu Thachat


The blog is associated with information on Indian stock market and author’s investment view points on various emerging stocks/sectors. The contents discussed in this blog are purely my own personal opinion and in no case weigh it as any kind of recommendation for stock market investment. The sheer purpose of this blog is to educate the interested community on market related subjects based on my experience and I am, in no way, responsible for investment decisions based on the contents described in this blog.

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