Investing

This page contains our best articles on the subject of value investing and investment behaviour.

If you wish to receive these and all future such articles straight into your email, subscribe below to my free newsletter - The Safal Niveshak Post - that offers practical, time-tested insights to help you navigate stock market with confidence. Subscribers call it a "gold mine" for investors, and it's read by 80,000+ people across 120+ countries.

* No charge. No spam. Only wisdom.

My Stock Investment Philosophy

My Stock Investment Philosophy While I have discussed my principles, experiences and learning as an investor through various posts in the past, some readers have asked for everything at one place.

So here is my investment philosophy for stocks…developed through practice over the past nine years…all at one place.

You might not agree to some of the parts of this philosophy note. But as I said, this is ‘my’ personal investment philosophy, which suits my personality as an investor. And you are completely different from what I am.

Anyways, here I go…

Some Advice for the Young…and Broke

Young and Broke I generally don’t like offering advice on this platform – Safal Niveshak is all about sharing my experiences and learning as an investor and manager of my own money. So the headline of this post seems a bit awkward to me.

But then, what follows is my response to some common claims that I’ve heard from a lot of well-educated and confident (yet broke) young people…and I was one of them a few year back. (I’m still educated and confident, but have taken care of that ‘broke’ part :-))

Here are some things I’ve been hearing all around from the young with respect to their careers and finances, and my thoughts on their thoughts…

Psychology of a Stock Market Loser

Here’s part of a conversation I had last weekend with a friend who wanted me to help him out with his loss-making stocks. Let’s call him Rohan.

Me: Why are you so depressed?

Rohan: I hate my stocks.

Me: Oh, another member of the pretty big ‘I hate my stocks’ club?

Rohan: I’m sick of looking at my stocks. And given that the markets are falling, I haven’t looked at my portfolio for days!

Me: What stocks do you own at the moment?

Rohan: Don’t want to show.

Real Life Story: How to Increase Your Savings by 9200%

Most queries I’ve received on Safal Niveshak over the past ten months have been from young men, either newly married, or already with one child. And most of their questions have revolved around…

How do I start saving and investing money?
How do I plan for a well-structured financial life?
How do I meet my life goals?

While I have responded to these queries, here is the real life story of a close friend (let’s call him Ravi) who was in the same fix almost 9 years ago, how he has been progressing well towards his financial goals (at least what it seems as of now), and how he has grown his savings by a massive 9200% over four stages of his life.

Start Worrying about Your Personal Finances. Seriously!

Last Saturday, I was amongst a group of young architects (age-group of 25 to 35), lecturing on the art of managing one’s own personal finances, and the need to start saving and investing as early as possible.

Lecture on Personal Financial Planning at DesignWorks

At the end of it, I asked them, “So are you worried after listening to what I said?”

Some were surprised to hear this. “Worried? Why?” one of them asked.

“Indeed, I am very worried!” said another.

“Worried, and excited,” said the third.

Why Real Estate Will Remain Expensive in India

Here is an email I received from a reader of The Safal Niveshak Post some time back.

I am an NRI living in the Gulf, with no plans to return to India in the near future. Now the problem is that, my wife and all her relatives are insisting that I invest in real estate in Chennai. They feel that it is the real “solid” investment, all the rest is in paper. They keep giving me examples of other people, especially relatives, who have seen terrific returns by investing in real estate.

But, when I see the current prices when compared to the rental yield and the risk and hassle which we take upon ourselves when we invest in real estate, it makes me hesitate. Also when I went to the OMR (Old Mahabalipuram Road) I saw at least 15,000 to 20,000 new units coming up…including Hiranandani, Purvankara and the others. Most of the purchasers there are investors who are planning to rent them out.

Will it not create a glut of housing in the near future and bring down the rents even more?

I already have an own house in Chennai, so, even when I come to India, I have a place to stay.

Because I’m an NRI, all my money is white and I feel that the high prices in Chennai or anywhere in India, are due to a large extent due to the black money involved.

Infosys: Good to Buy?

Infosys On 22nd February 2012, I’d sent you a comprehensive research report on Infosys, as part of the StockTalk initiative.

The stock was then trading at Rs 2,940, and this is what my analysis told me to write to you…

…the fair value range for Infosys’s stock is Rs 2,740 to Rs 3,050. Assuming a margin of safety of around 20%, I would be comfortable buying Infosys’s stock at any price less than Rs 2,450…but not more than that.

Given that the stock’s current price of around Rs 2,940, I would wait for it to fall by around 15% before buying into the same.

That’s a good case of a great company, but not a great investment (at the current price).

So it is clear from the above words that while I was comfortable about Infosys as a business, I was not comfortable about Infosys as a stock as I believed its price was expensive (as I wrote – “…a great company, but not a great investment…”).

7 Reasons to NOT Buy Gold this Akshaya Tritiya

It’s everywhere!

Whether you read a newspaper, or listen to a radio station, or watch the television, or even just go out in a crowded place…everyone is talking about gold.

Mutual funds are launching gold funds. Brokers are launching e-gold services. Banks are offering loans against gold. Jewellers are offering gold at discount.

The liking for the yellow metal has reached such high levels that I’ve seen people offering me 10 reasons why I must buy gold (and loads of it) before it’s too late!

However, I have my 7 reasons why I am not, and why even you must not buy gold this Akshaya Tritiya… [Read more…] about 7 Reasons to NOT Buy Gold this Akshaya Tritiya

Investor, Do You Know Where You Are Going?

“Would you tell me, please, which way I ought to go from here?”

“That depends a good deal on where you want to get to,” said the Cheshire Cat.

“I don’t much care where…” said Alice.

“Then it doesn’t matter which way you go,” said the Cat.

“…just so long as I get SOMEWHERE,” Alice added as an explanation.

“Oh, you’re sure to do that,” said the Cat, “if you only walk long enough.”

~ Lewis Carroll, Alice in Wonderland

This discussion from Alice in Wonderland says a lot about how we keep trying (keep walking) when we are aiming to get somewhere, or achieve something, in life (like financial freedom).

But then, let me ask, when it comes to your financial and investing life – “Do you know where you are going?”

Safal Niveshak StockTalk #6: Balmer Lawrie & Co. Ltd.

Welcome to the sixth issue of the Safal Niveshak StockTalk.

After covering Graphite India last time, this time I delve deeper into another small-cap company, Balmer Lawrie & Co. Ltd. (BLCL). Before we dive deeper into BLCL, here is a brief overview of the sections of this report.

About BLCL
Safal Niveshak’s 20-Point Checklist
Intrinsic Value Assumptions
Financial & Market Snapshot
“Should I Buy BLCL?” Checklist