3 Deadly Sins of Stock Market.

Have you ever think why new investors most of time failed in market.  ? Why only few make real money in stock market? What new person in stock market should do or should not do?  If yes I have answer to the root of this problem.

There 3 common mistakes that most investors do. I call them 3 Sins of Stock Market. 

1.Losing Money:

Most Investor knows this basic rule “Never Lose Money”. But still they end up losing money.  Because they keep holding the looser in hope of recovery. Simply say if you have purchased stock and it went down by 20%. And you wait as you not want to lose money. But this same stock has capability to go more 20% down. Not taking loses in market is biggest mistake most of investors do. Short term downside is normal, but if stock is going down for years or not moving for years then this is also one kind of loss as you are missing opportunity to allocate this money to some other good stock.  Remember there is no Successful investor who didn’t book loses. Taking lose is part of Journey and Investor must accept it.

      2. Buying Quantity then Quality:  

      Every new investor does this mistake.  They like buy 100 stocks of 10 over 1 stock of 1000.  Cost is same but he thinks he will get better chance with 100 stocks then 1. But in market price doesn’t matter.  In both case investment amount is 1000. And in both cases if stock goes up 10% you make 100 profits. So your buying decision should not be just on price factor. I have seen stock worth of 5000 in my career which I didn’t added because of price and same stock is now 22000 in 4 years and still going up. And I also seen stock which was 20 buck 4 years ago and still around 20 odd today also. Yes I am taking about Eicher Motors and Suzlon.

         3. Selling Winners:

       This is where successful investor standout form ordinary investor. Buy Right and Sit Tight. When you get stock which has shown potential to go up, you should not sell it for ordinary profit unless it’s really necessary. Stock which went up 50% has capability to go 100%. Smart Investor is one who adds stock on raise not on fall. Averaging should be done for stock which has shown its potential to go up not for stock which has shown its potential to go down.  Buy correct stock and let compounding do its magic.

     "To make money in stocks you must have the vision to see them, the courage to buy them   and         the patience to hold them. Patience is the rarest of the three." — Thomas Phelps

                                                            Be Smart. Invest Smartly. 

Top 5 Dividend Stocks of last 10 year

When Investor was looking for good stock , dividend would be the very important factor to be consider. Stock go up down but consistence dividend make your investment worth. For conservative investor with low risk profile good dividend paying stock would be the best to invest.

Here we have try to bring few very good stock with great dividend payout over the last 10 year.

Infosys

 IT giant Infosys is always giving handsome dividend to its investor since inception.Even for last 2 year Infosys is facing growth issue because of the slow down in spending of BFSI client but for conservative investor Infosys is paradise. Study stocks growth with good return that what all they need. Let have look into infosys 10 year stock and dividend data.

Jan 2006 Infosys was trading at around 360 INR and now it is around 1027 INR.  Stock has given 185 % return with CAGR of 10.19%. Now let’s have look at dividend data. In last 10 year Infosys has declared 438.5 INR as dividend. This make total dividend of 121 % if stock brought at 360 in 2006. So 10 year average dividend yield is 12% around. If you have PPF or any other such investment time to think again.

Manappuram Finance: 

Manappuram finance is India’s Largest Listed and Highest Credit Rated Gold Loan Company.It Currently trading at 94.4 INR as on 14th Oct 2016. It is very hard to believe but this stock was traded at just 0.63 INR back in 2006. In 10 year stock price surge 149 times.

  If investor has invested in Manappuram Finance in Jan 2006 then he would had received  11.06 INR dividend till date.Now with investment price 0.63 INR , 10 year dividend payout would be stand 1755% with average of 175%. If you still not believe please read our last post: Stock with 150% average yearly dividend yield since 10 Year

 Clariant Chemicals India Ltd

Clariant Chemicals India Ltd is largest producer of Pigments, Textile Chemicals & Leather Chemicals in India. Also it is one of the highest dividends paying company we found.  Stock Price on 2006 was 333.75 INR which raise staidly to 805 INR today.  CAGR of stock for last 10 year is 8.5% but stock has paid 491.5 INR as Dividend in last 10 year and its average Yearly Dividend Yield is 14.72 % for 10 years.

NMDC

NMDC is state-controlled mineral producer of the Government of India. NMDC is one of the consistence dividend players in Indian stock market. NMDC was traded at 45 INR around in 2006 while it is now 117 INR.  So stock has given 160% ROI with 10% CAGR. Sometime in last 10 year NMDC has given 56.17 INR as Dividend which make it 124% yield and 10 year average Dividend yield is 12.4% .

Hindustan Zinc Limited

Hindustan Zinc Limited (HZL) is an integrated mining and resources producer of zinc, lead, silver and cadmium. It is a subsidiary of Vedanta Resources PLC.  HZL is consistence growth stock with healthy dividend. Stock raised from 25 in Jan 2006 to 245 INR today. With ROI 880% and CAGR of23% Hindustan Zinc makes valuable investment. Stock has paid total 46.7 INR as dividend in same period which make total 10year yield 186 % and annual average of 10 year yield 18.6%. No doubt it make in our list.

Remember Good stock come with great dividend. Don’t forget to look at dividend while you are investing next time. Also please do share  this and comment your view.

“Do you know the only thing that gives me pleasure? It’s to see my dividends coming in.”
–John D. Rockefeller

Be Smart. Invest Smartly

Multibagger stocks of tomorrow.

How to find Multi Bagger Stocks?

1.Promoter’s track record.

 

This parameter is having highest priority. If the management is not honest, will they want to share the benefit with you? No, they will look for the first opportunity to draw off the profits and pull the wool over your eyes. If you study TCS, Tata Motors or any of Tata group of companies, you will understand that they are having excellent top management. We can trust Tata. Promoter record should not be fraudulent.

2.Unique business model.

 

A stock with a monopoly or duopoly command in that particular market sector would be great. VST Industries, for instance, operates in the particular cigarette industry, where there is no danger of fresh competition coming in here in India. CRISIL, Nestle are good examples. A powerful brand that draws customers is necessary.

3. Business growth opportunity should be exponential

In simple words, if you are pretty sure about company’s growth at the rate of 20% to 25% on year on year basis with significant visibility for more than 5+ years, then you have identified correct multibagger stock.

4.Capital requirement should be less

Company should require minimal capital but generating huge returns there from. Generally IT companies require very minimum capex for expansion as compared to infrastructure/real estate company to run their projects.

other than this their are many other factor.

Some stock that I have sorted out which could be Run a Long way..

Adani Power : CMP 48.4 .

Tata Coffee: CMP 944.

Ashok Lyend: CMP 22.7

Jaiprakash Power :CMP 14.25

Tata Motors: CMP 396

Be Smart. Invest Smartly.

Don't know about Indian stocks? Follow simple fundamental things.

People says "I am not a analyst of stock market; I don't know anything about it."

There is no requirement to be Master either for that.

Let's explain it with simple example:
 Go out and ask any 10 random person below question:

1. Which is India's lagrest public sector Bank?
2. Name of  one paint company.
3. India's  biggest india's largest two wheeler manufacturer?

Now let me guess the answer you got:

1. Which is India's lagrest public sector Bank?: State Bank of India
2. Name of  one paint company.: Asian Paint
3. India's  biggest india's largest two wheeler manufacturer?: Hero Moto Crop (people may aslo says HeroHona).

So this is the key of finding best stocks.

Lets get brief of each of this three stocks.

1. State Bank Of India:

Well know bank. Your father may have account in this or may have FD in this bank.People have faith in SBI
so why not in its Stocks.

SBI stock price on 3rd Jan 2014: 1716 INR
Now let's go to 10 year back
SBI stock price in Jan 2004: 560 INR around
Now if we calculate return its triple in 10 year. And we have not include dividend here.

2. Asian Paints :

Small school going kids also know about this name.
Dominant in Indian Paint industries since many years. 
 
Asain Paints stock price on 3rd Jan 2014: 489 INR
Asain Paints stock price in Jan 2004: Just 33 INR aroundDon't calculate return of ten year. You will lost your mind its more than 14 time. 

 3 Hero Moto Crop:
 
" Desh Ki Dhadakn" . Its a bike of common people.
Even today with many bike company in market still Hero's Splendor is best seller bike now also. And for just for knowledge now days biggest competitor of Splendor bike is Honda's Activa which was few years back partner of Hero.

Hero Moto Crop stock price on 3rd Jan 2014: 2096 INR
Hero Moto Crop stock price in Jan 2004:  456 INR 


After reading this article you may ask your self why you don't invest in this company. But it's not latenow. This are pioneer of there sectors and they are continuously growing with study rate.Investing in this compnay
will worth your money.

If you like this article please comment your views on investment. You can mail me on jethi_keval@yahoo.com.

Be Smart. Invest smartly.
(* I have personal holding in SBI but not in other two company.)