Sunday, June 15, 2008

Will Opportunities Be Lost Again?

Economics has conventionally told us that as prices go down demand goes up - look at what is happening to the stock markets. Prices are going down, but is demand going up? It makes me laugh at times to think how millions of investors behave and I remember when I was very new to the markets, I too would behave in a similar fashion. I made mistakes, but I am glad I made them because I learnt a lot from them.

One thing I learnt is that every once in a way, we investors are given wonderful opportunities and the only mistake many of us make is to let these opportunities pass by, just because people around us are talking about doom.

I keep hearing people telling me how stock markets will hit 12,000 levels and they will buy at that time. The same people start grumbling when the stock markets rise and say "I wish I had bought then." Personally I don't know if stock markets will hit 12,000 levels or will hit 21,000 levels, I don't think anybody really knows it. What I know is that there are companies which are offering wonderful opportunities today. Investing in them today, doesn't mean that their stock prices won't go down in the near term- I always buy into them prepared for them to go down in the short term because I have learnt that investing is not a 'get-rich-quick' game. I follow a simple principle of never investing all my money, so that in case things become cheaper, I can buy more. The rewards from these opportunities will not be instant and you might have to wait for at least 3-4 years, but that is what investing is about. We can't plant a mango seed and expect to have a mango tree within one month. That might be possible if we plant weeds, but not with a tree which will give you and your family fruits for life.

At the moment you need to make sure that you ask yourself a very simple question. Ask yourself "Do I want to lose out opportunities which have the power to change my financial future or do I want to follow the herd?"

I hope that you decide wisely and don't lose opportunities again. You might be knowing about a few of my past investments, if you realize most of them were made when these stocks weren't the talk of town. You will realize that after buying into them, the stock price did go lower and I had to wait for a few years to be rewarded. Once again we are blessed with opportunities and this time I hope all of you make the most of them.

I would also like to thank all you lovely Happionaires for sending me such lovely e-mails, however it is extremely difficult for me to reply to over 200-250 e-mails in a single day. It would be great if you could use the comments section in the blog to communicate and share your ideas and views. I hope you understand and I apologize for it!

Also since it is Father's Day, I thought I will share a wonderful story written by a fellow Happionaire- Gopinath Mavinkurve called Daughters are Forever!

Happy Father's Day and Happy Investing!

Yogesh Chabria

Find Out What Happionaires Had To Say About What Needs To Be Done With Inflation


Anonymous said...

Excellent post. I feel people will never learn and will lose opprunitites. After a few years we will be talking about stocks that a few of us are investing into now, while others will keep asking for 'stock-tips'. It has happened in the past- it will happen in the future.

However I feel a larger number of people will think about buying now into strong companies thanks to your wonderful blog which helps spread knowledge rather than panic buying and selling on tips. This is one of India's best financial and investment blogs according to me.

Anonymous said...

Very clear cut, to the point post..
Choose sound companies, buy them on every dips.
I would like to share with fellow happionaires that Yogeshji's "happionaire way of investing" not only sounds good on paper, or for that matter on blog post, but also works in real term.
Take my example, I used to buy stocks listening to so called "experts" who show up on TV shows and change their forecasts very often. After going through Yogeshji's book, now I only hear to those experts, and only listen to my own instinct.
To be specific, as a media person I bought Jagran Prakashan at 90 with full confidence in the company. Stock price went down to 85, I again bought a few. It again went down to 80, then 75, then 71 and found bottom around 68 which is its one year low. I purchased stocks in small quantity on every dip, and now people have started finding value in it. Stock has started to move up.
Thus, I have not lost opportunity and dam confident that if again stock will move down, I am ready to grab more.
Follow rules of happionaire way of investing, creat wealth, be happy!

Anonymous said...

Agree 1000% with your Kuldeep and what a co-incidence - I have also been looking at paper industry because I have seen how demand is going up and prices are also going up.
You got any views on Rama?

What I like best here is that we all get to think for ourselves and this place really motivates me to research on my own. As Yogesh says "Investing is not a competitive sport" we need to do it on our own using our own head.

Anonymous said...

great going yogesh. I started investing just 2 months back after reading your book..
i invest ard 5-8k monthly. As u said, i have learnt from my mistakes. Initially, i used to invest as soon as i got my salary in hand. But then, when the markets were really down i didnt have cash to buy anything. Just had to watch my stocks falling day after day., only then i realised the importance of keeping a part aside instead of investing at once.
Now i have started investing for my brother as well. I have done a few mistakes. Now i am taking care that I dont repeat those mistakes in my brother's case.
Learnt a lot from you Yogesh. I owe a lot to u. You are the only reason Y i have ard 50k in my portfolio in 2 months. Else i would have spent everything. I spend less and save more these days. Thanks to you Yogesh.
I am also learning to pick stocks the Happionoaire way. But, am not really sure, whether i have picked the right stock. Can i forward the company i have picked and the details so that u can have a look and let me know whether am going in the right direction. That would be very helpful.

Mavin said...

Agree with you totally. With the sharp fall in prices, it is like a "bumper discount sale" going on with no time limit.

Whilst picking on declines make much sense, I thought that many could consider investing fixed amounts every month in an Index Fund. Low costs and no fund manager bias.

Those who are strapped for time should look at such options. May be you may want to detail a bit more on Index funds.


Anonymous said...

Agree 100% Mavin. Vanguard is good. I have been following you blog Yogesh to learn more about your great country. Plan to invest there for the future.

I loved your writings and they give me a lot of positive motivation. There is this positive energy which spreads not just to investing but to other areas too.

Lots of love and happy investing from America!

Anonymous said...

Great to see you here Tim and I wish more Indians would also have faith in our great country as people outside the nation. Instead of having panic attacks we need to look for value.

About the positive energy, I love that one factor because it makes everything so much easier. You are the young Deepak Chopra.