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Showing posts from March 11, 2007

Dos and don'ts in stock picking

Srividhya Sivakumar If you are an investor on the look out for undiscovered stocks with great growth prospects, be assured you are not the only one! With the stock market no longer predictable, chancing upon value buys in the current market is no more anybody's game. If the bull market that made us all feel like geniuses, remember that the same market, when in a downward or sideways mood, can make fools out of geniuses too. The point is though stock picking in this market is not impossible, it is not going to be easy either. You would have to exercise more caution and restraint. Though there are no foolproof ways of stock picking, there are some dos and don'ts to help invest wisely. Here are some of them. Stick to fundamentals Remember to put money only in those stocks that you think are well-placed fundamentally. A company in a known business with reasonable financials is likely to provide better returns over the long term than one without a convincing business model or histor...

5 common investing mistakes

March 13, 2007 09:14 IST B ad investments or wrong investments are a part and parcel of any portfolio. The idea is not to get defensive about it but to understand the reason(s) and make sure we don't repeat the mistakes. Broadly speaking, bad investments can happen due to two reasons. One, of course, is market conditions. Say you invest in a share after due research. But the company fails and you lose money. Or you have a fixed deposit (FD) in a co-operative bank, which runs into problems and your money is stuck. Or you invest in a five-year FD and, immediately afterwards, the rates are revised upwards. These situations are beyond your control. These are market risks which are part of any investment. You win some, you lose some! The second reason has to do with ourselves -- our knowledge, our psychology, our research, et cetera. These factors are under our control. If we exercise this control diligently, we can keep away from bad or wrong investments. 1. It's greed, of course C...