STUDY WELL BEFORE INVESTING IN THE MARKET
Everyone wants
to invest in the market, with a view to earn money. But it is not necessary that, every investment will result in profits. An article in Dalal Street, an investment journal of Jan21-Feb 03, 08, cautions all investors to carry out research, and examine various aspects of the companies closely, before deciding about investments. There are surprises and unexpected changes in the market, which may lead us to trouble. Our analysis of the company should consider its management, capabilities and business practices, with more stress on the management of the company. Our efforts should not be, to invest only in one odd company, or in too many companies. The first one is risky, and the second one causes difficulties in regular monitoring and evaluation of the companies. We have to review periodically and take decisions at short notice, to invest and to disinvest. Hence our investment should be a mix of several types, with reasonably liquid stocks. It is suggested to invest only in good quality stocks, so that there are more prospects of earning money. We should not borrow money, for investing in the market and also intra-day trading. There is always a difference between large and small investors, and also old and new investors. We may invest through brokers in the stock market, but we should always do our own study, research, evaluation and decision.