Learning Points for a Newbie Investor

The overall interest in investing in stock market is back with full swing. Almost everybody is talking about bonds, IPOs, real estate as if they have been invented recently. Having said that, I love the passion behind it when they talk about it. When folks talk with passion and fire in their bellies, a newbie coming right of the college thinks, wow! that’s the way to go. Recently, a distant family acquaintance was asking me about my opinion about recent surge in IPOs, bonds, and stock market rise. This kid will be graduating next summer (note: next summer, i.e. 2011) from an engineering school and has already got a decent job through campus recruitment. The salary cash flow has not started, and he is already planning to “get-in the market”. He was “researching” what are different methods to make successful “bets” in the market. Continue reading rest of this article…

Making Quick Money in Stock Market is a Mirage

I am sharing a story sent to me via email by one of the readers of TIPBlog. Here, this reader is narrating this experience about multiple attempts to make quick bucks from stock markets. After the story I will present my views and thoughts about it.


Sometime in 2002, March/April, I was doing my engineering and started working for a call center in the night to take care of my extra spending. I never knew or thought about stock market or any kind of investment. I spent two years in call center and spend many hours in the night watching CNBC after coming back from work. I learned few things about banking, credit cards, insurance, investment, and so on. In two years, I watched markets go up. I always thought I should invest in IPO and make some money on listing. However, I could not do so because I didn’t have a Dmat account. Continue reading rest of this article…

My Second Hour Conversation with An Ex-Colleague

conversation_115898_twins_1It has been close to 50 minutes, DS and I not only recognized each other, but it also looked like we were back to our old days when we would just go on and on about stock market ideas. In my last post, I stopped at when DS mentioned how he attempted to maintain two different types of portfolio, one for trading and one for long term portfolio. So the conversation continues….

I said, “DS, I have been fascinated, and quietly toyed with the idea of having such different portfolios”, “But wait before you get any ideas”.

You see folks, I wanted to add my disclaimer like we do in all walks of life, so I add, “I have not used it, but I am fascinated by this thought”. Before I say anything else, he jumps in. Continue reading rest of this article…

My First Hour Conversation with An Ex-Colleague

807852_friends_in_businessI am sitting at Singapore’s Changi International Airport. It is middle of the night, and I come to know my flight is delayed by four hours for technical reasons. I was contemplating what should I do. Made few personal calls and then I decide to munch on unhealthy burger and some fries. I was getting bored, so I started browsing the internet. I log into my blog’s wordpress interface and opened another tab with my blog. I was hoping to answer my emails and blog comments. That just remained a hope.

While I was reading comments, an Indian gentleman came and said, “may I sit here” pointing a chair just across me. I said, “sure, be my guest”. We exchanged few more pleasantries, and then each of us continued doing our own stuff. He started playing with his blackberry, and I turned my eyes to my computer. At the same time, I am thinking, there is no one around in this cafeteria, tons of empty chairs, so why this guy came just next to me. Usually, we just go and sit in an empty space.

I said to myself, “hmm, forget it, why bother”. I went back to reading comments and emails.

Few minutes later, he stops playing with his blackberry. He is looking around. I can sense he wants to talk to me. The moment I raise my head, he says, “The blog you are reading is awesome. Isn’t it?” Continue reading rest of this article…

Determining ROI from TIPBlog

ROI_imageWe as human beings are always objective or goal oriented. We may not know it, but sub-consciously, we are always attempting to do a given task or an activity towards certain goal. Many folks will not agree with me, because there is a perception that ROI is always related to money. To me, it is not. If I spend time with my family, its because the pleasure I get (that’s an ROI). If I did not get that pleasure, overtime it will automatically create a rift. Similarly, if I play any team sports, or go out with friends, it builds our relationship, it builds camaraderie, a sense of togetherness. It is not necessarily for getting any money in return, but to be part of social community. You cannot live alone in this world, right? Keeping with this, the question I am trying to answer today is what is my ROI from this blog? I need to know what I am getting out of this blog. Here also, I will use the framework provided by Avinash. There are multiple parameters to determine ROI from the blog. Continue reading rest of this article…

Stock Market for 2010: What’s Your Prediction ?

265713_confusionFor many of us retail investors, there is a perennial dilemma about two issues. One is about how we should invest and where we should invest. The second one is we always say (or crib) we do not have big enough capital. We never get out of this loop. Which stock to buy or where to invest is decided based on what was read yesterday. Everybody from the top VP of financial firm to any small investors like us, we keep churning out ideas, themes, predictions, estimates, etc. But we do not have conviction in our own ideas. Honestly, I love reading all those ideas as they do make some interesting reading material, but that’s not the way to manage your personal portfolio. .

As year 2009 is nearing completion, I have been reading new predictions and themes for year 2010. It is quite amusing to read what folks have to say. I always wonder do any of these forecasters follow their own advice. Could we take a peek at their portfolios? Here are few excerpts: Continue reading rest of this article…

Investing Success Comes from Conviction and Executing Your Ideas

1133804_sign_success_and_failureDo you know how many people investing and/or trading in equity markets truly succeed over long term? Success here means increase in wealth over their investing lifetimes. This group of people includes individual retail folks and professionals. I am sure many of us would have no clue.  I do not have any hard core reference to share; however, I can recall reading various percentages that range from 1% to 7%. Without going in specific data points, my observation has been every time this is less than 10% of investing population. More than 90% of the folks will lose money in equity markets over their investing lifetime. Quite startling but this is very true.

We as individuals focus too much on one or two big time success or multi baggers, but ignore the importance of sustainability and consistency. We fall into the “Chalta hai” trap. Long term success is not built on few multi-baggers. Long term success is built on multiple average successes that are sustainable over time. Continue reading rest of this article…