Types of investing

•Growth investing - Where free cash flow is mostly negative because the company reinvests cash into another business or expansion.( you can get multibagger)

•Value investing - Where free cash flow is compounded over a period of time. therefore, sustainability comes in bad times and profits grow at normal market returns. ( you can taste the power of compounding)

•Special situations - When merger, demerger or any event like this happens.

•Commodities - This is a cyclical business where we need to understand the cycle, Frist.

•Turnarounds- Where management change or any tailwind for a company or sector which need to understand.

Comments

No More 'Buy and Hold' – Try 'Buy and Monitor' for Better Investments

Ever wonder how some people consistently make more money in the stock market? It's not magic – it's a mix of paying attention and making smart choices. Let's explore the simple tricks these successful investors use to get better returns than the average. Listen to Insiders: What They Know Matters Successful investors keep an ear out for insider trading updates. Why? Because if someone inside a company is buying or selling their own company's stock, they might know something good or bad is coming. Buybacks & Rights Issues: Company Confidence and Cash In Smart investors like it when companies buy back their own shares or offer existing shareholders the chance to buy more at a discount. It's like the company saying, "Our stock is a good deal!" IPOs & Big Corporate Announcements: Ride the Wave of News Beyond new companies going public (IPOs), successful investors pay attention when companies make Corporate big announcements. Events like demergers, me...

FAANG

This is a popular short name for the world's largest companies (F=facebook, A=Apple, A=Amazon, N=Netflix, G=google). I believe that they are not providing us basic needs in life. If we stay away from that, then we can save a lot of money, time, and attention, and, more importantly, we can save our economy. Facebook is much more costly as attention and time. Amazon is costly as extra shopping or marketing. Google is costly as retained knowledge. and Apple is expensive for our wallets. Netflix can be expensive at time .

Loss aversion

People always tend to put their money in safe investment brackets like bank accounts, FDs, etc. They always feel safe with those investments. This phenomenon is called loss aversion. As per Investopedia, " Loss aversion in behavioral economics refers to a phenomenon where a real or potential loss is perceived by individuals as psychologically or emotionally more severe than an equivalent gain. For instance, the pain of losing $100 is often far greater than the joy gained in finding the same amount. Let me give one example of how this phenomenon works in real life. a man who wants to earn twice as much as an FD (roughly 10-12%) Put 1 lakh RS. in three stocks for the next two years. One stock doubled within two years and the other two have generated minus 20% returns over the next two years. Overall returns should be around 10% CAGR over 3 lakh RS. But the pain of two investments that don't provide any returns over two years is much more than two stocks that double within a sh...

Stereotype of investing and life

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