What is the key to successful investing?
- This information is for the investors not for traders who invest in mutual funds
- This information is not circulated in public domain and retail investors try different options to earn money from the stock market
- If you want to know why this information is not shared with retail nvestors read our blogs 1. Stock market educators or institute vs retail traders 2. The truth of the brokerage industry, Trading expert & retail traders 3. Smart money vs Dumb money in the Stock market
- After reading these blogs you will familiar with the stock market working principle
- Successful investing is all about the common sense but it is not easy.
- The best winning strategy is to buy the index funds. By this way, we can collect all the dividends and earnings growth of the stocks.
- Index funds help us to eliminate the risk of an individual stock, sector risk and manager stock selection risk. The only risk remains while you invest in an index fund will be the stock market risk.
- Investing is all about compounding the value.
- Over the past years including the stock market crisis. Stock market grows at the compounding rate of more than 10%
- Don't underestimate the power of compounding.
- You can calculate the returns in 25 years https://www.axisbank.com/retail/calculators/sip-calculator
- In the stock market company earning is the main driver of the stock price
- If earning of company don't grow and stops the share price will fall
- You read somewhere that stock market is a zero-sum game
- But the truth is the stock market is minus sum game
- Here the winners are the exchanges that collect the fee, the broker, the investment bank which lends money to the broker, and the government collect the taxes.
- All these will increase the chances lose for retail investors
- The only way to make money is by investing in performing index funds not sectoral funds
- The approach of Retails investors or individuals: Short time frame ranges from 1 day -4hr-1hr-5min. Looking to make quick money so if you are looking for quick money you can lose money quickly.
- Risk of Retails investors or individuals: Most of the retail traders have 2-3 positions. They are mostly one side of the market either in long or short. If the market turns against them their account get down by 50 %.
- Return of Retails investors or individuals: Retail traders take the risk of 50% over the return of 25%.They trade is based up the news and when the news comes they exit their positions with small profits or exits with 50% loss if the news turns against them.
- The outcome of Retails investors or individuals:: The outcomes of the retail trader is capital destruction and end up with zero in the account within 90 days.
1 Comments
very good thanks https://docs.google.com/spreadsheets/d/1ov9ixS19JOjE2HPNJ_u6mU9AMFx13muG14d_L2pTYkU/edit?usp=sharing
ReplyDeleteThank you for your valuable comment