Personal Financing 104 - Demystifying equity investing
Equity investing is a lot of common sense. It can make one a multi-bagger, as long as one ensures right time of stock entry and exit. We shall park our discussion on valuation ratios for the next post. In the current post, let’s focus our attention on some of the most common things one should look out for while investing in a company. So, we shall try and answer few commonly asked questions and understand few myths associated with equity investing. 1. Assume you have no other information available. Only two fancy company names. Which of the two companies are you more likely to invest in? Denyard international or Maxus Chemicals Ltd.? Most people will answer the first one as their choice. The name looks fancy.The business they operate in should be equally fancy. But, sadly, in equity market, boring is better! Maxus Chemicals may be in the business of selling a daily use chemical and will continue to do so. It may never die. And as more and more p...
