multibagger

Identifying multibagger stocks for SIP

A mutual fund house selects many stocks from different sectors and multibaggercreates a balanced portfolio. This diversification helps mitigating risk but it also polarizes your funds. Once a sector gets hit, the total fund value comes down. You cannot choose to shift away from these stocks and have to wait till it gets better. It is always wise to select a bunch of stocks yourself and bet regularly. There are more than 7000 stocks in BSE & NSE combined. It is like searching a drop in an ocean, tedious but possible. There are several factors on which a stock is screened before qualifying it as a potential multibagger. Given the technological tools we have today, it is a lot easier than it was a decade back. Before searching for a multibagger we must first decide on our risk capacity.

Ask yourself two questions:
How much can I save from my monthly income?
How much can I save from my monthly expenses?

Spend more time on the second question. Make no mistake, I am not asking you to decrease expenses. Just add a little more to your expense each and every time you spend. In other words, tax yourself. Transfer a percentage of the total expense to your trading account (call it an iTax, myTax or whatever you wish) but do it for every transaction you do. It might sound crazy but believe me, it works wonders!! You can either invest this taxed amount in certain stocks or use it as a risk manager when your stock trades lower than previous highs.

Now let’s search for the drop. Our ocean is made of different sectors and all these sectors are dependent on each other in one-way or other. There is no fool-proof way to find an ever bullish sector. Instead, find a visible problem the world is facing today and the sector which is directly related to solving the problem. For example, pollution is an alarming issue throughout the world and it is only getting worse day by day. Many governments have already started taking steps to control pollution in every possible way. Hence, we can find a stock which deals with pollution control. On the same lines is cyber security. Every business is online and all need to be safe. Companies which offer cybersecurity are going to be in demand, hopefully, in the near future. Next challenge will be to square in on a stock in this sector. That is where fundamentals of a company come in handy. Look at few important factors like Market Cap, Book value, P/E vs Industry P/E and Dividend yield. Check the financial trend of the company. Many growing companies report negative net profit but their net sales might still be increasing which is a positive sign. Above all this is the credibility of promoter group; make sure you have read their activities in the market.
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Systematic Investment Plans Guidelines

Benefits of Systematic Investment Plan (SIP)

“Disciplined investors built their own empire, others just made money”

systematic investment plans

Stock markets are for the rich, who can throw their money at anything and wait for a bigger fortune. This is the biggest myth I have ever heard and also the most common myth among retail investors. In the hindsight, this is the only place where millionaires are made from nowhere. All you need to do is to follow few strategies and stick to a discipline. Among many investment strategies in the stock market, Systematic Investment Plan (SIP) stands out to be the least complicated one. Investing in SIP is like learning to swim. The earlier you invest the greater your returns in the long run. There are two ways to invest in SIP. Either you choose a mutual fund available in the market or you can choose few stocks yourself and keep investing. It is like paying Pre-EMI. When you buy something and pay EMI, you are actually paying an interest to the bank thereby increasing the cost of the product you bought. The bank decides the interest and the EMI. Longer the duration, higher is the interest. You cannot skip an EMI and have to pay it on the specified date.  If you wish to… close in-between, you will have to pay a penalty. The interest rate fluctuates depending on the market condition.

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life-stages

Prepare for Money Through All Your Life Stages (Age 18-56)

life-stagesNo matter where you are in life, contributing to your employer’s retirement saving plan may be an investment in your future.

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So, where are you on the road to retirement planning?

These snapshots reflect the challenges and opportunities you could face at each stage of your life as you prepare for retirement:

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You’re 18 – 25

You’re a grown up now and on your own. Enjoy this time of your life, but realize that the future will begin coming at you sooner than you think – like tomorrow. You’d be wise to plan for it today by opening a bank savings account or signing up for your employer’s retirement savings plan. After all, the more time you have, the more you can invest and the longer your investment has the potential to grow.

You’re 26 – 35

Remember when you started out on your own and vowed to save more money? How’s that going? Many things in your life keep you from investing more: credit card debt, vacations, cars, maybe starting a family. The spending list is endless, but the time you have to invest for retirement isn’t. If you haven’t already, investigate your employer’s 401k or similar retirement savings plan.

You’re 36 – 45

Now’s probably the busiest time in your life. You may be managing a career and family – and list of things keeping you from investing more for your retirement has only grown in the last few years. Although time is still on our side, you have 15 or more years before retirement. It’s time to seriously focus on retirement planning. If you’re saving for retirement through your employer’s 401k plan, your investment portfolio has the opportunity to grow tax-deferred for some two decades.

You’re 46 – 55

No one wants to have to work during their retirement. But time is starting to work against you. If you’re not currently investing for your retirement, it’s time to get busy with an action plan.

You’re 56 or older with little or no investments for retirement

If you are not currently investing for your retirement, it’s time to get serious. You may need to make a lifestyle change now or you’ll be experiencing a much different lifestyle in retirement than you expected.

You’re 56 or older with a fair amount of investments for retirement

You may have a good start on your retirement investments, but it’s time to hone in of what lies just over the near horizon.

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A few points to consider

  • Financial experts estimate you’ll need 126 percent of your current income to maintain your lifestyle in retirement
  • With people living longer, you may spend 20 or more years in retirement
  • Income from your deferred-compensation plan can supplement your Social Security and pension

Keep in mind assets withdrawn from a qualified plan may be subject to a 10% penalty tax if withdrawn prior to age 591/2, and all may be subject to income tax.

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Take the next step

Now that you’re thinking about your retirement future and what you should consider at each stage in life, remember that you don’t have to be a financial expert to take action. You don’t even have to do it by yourself.

Which is best time for Trade?

Less is definitely more

the best times to day trader are usually the first two hours and after the open. Some traders also like to trade the last half-hour before the close.

Momentum is greatest at these times, with real buying and selling pressure creating the best trends.

Many real-time traders also follow the “3 strikes and you’re out” rule.

By limiting your trading to only three trades a day – MAX – you reduce your stress level enormously. You’ll be sharper and less likely to make.

You also insure yourself against a “suicide day”, when you take serial losses, each time trying to recover from the previous loss…

Reading this away from the market, you might feel you would never fall into that trap.

However, it’s surprising how many traders have come unstuck in a real-time avalanche as the losses begin to snowball.

The motto?

Tomorrow’s another day.

Take it easy. Don’t trade a 40- hour week. Accumulate your profit over time.

And you’ll make more by doing less.

How To Beat the 10 PITFALL of Trading?

This are some methods that can be help for beat the 10 pitfall’s of trading.

1. Having no trading plan

It becomes very expensive when your emotions are high and you have to make decisions on the hurry.

2. Using strategies that don’t match your personality

One important factor to consider is: does it match who you are and your lifestyle?

3. Having unrealistic expectations

Most traders imagine that it is very easy to make money in trading. They have unrealistic opportunity with regard to their initial capital, their risk profile and how much money they can expect to make.

4. Taking too much risk

Usually when traders are down, they want to make their money back very quickly. Therefore, they increase their position size without thinking about the risk/rewards.

5. Not having rules to follow

Most traders think if they have rules to follow, they are restricting themselves. It is on the contrary. Having rules allows you to be more flexible since you have thought about lots of issues beforehand.

6. Not being flexible to market conditions

It is very important to see the markets as they are and not as you want them to be or as you assume them to be.

7. Failing to take responsibility for your results

When you blame things outside of yourself, you become a victim of circumstance. When you take responsibility, you can react differently to your circumstances and become the success you know you can be.

8. Being addicted to volatility

One of the reasons that people get into trading is because they like the excitement of it. If there is no excitement, they create it. This is one of the reasons that traders sabotage themselves.

9. Not having a process to keep track of your performance

If you don’t keep track of your results, how do you know what has worked and what has not? How can you tweak your process to get the best results that you can?

10. Not dealing with your Emotional Risk

When dealing with money, there are lots of emotions involved. Emotions are part of everyday life. What separates the successful traders from others is how they react to their emotions.

Money

Top methods to invest money

Money

Investments and Savings are a fundamental element of monetary lives nowadays. Here are some ways which are look upon as the top for investments and money management.

Who can earn money? Anybody can earn money easily?

Yes, “anybody can make money, it’s the savings and investments that tally” is a saying that has turn into new fitting in the fresh world. In today’s fast volatile the human race, investments have become a catchword in the financial planet. Once the necessary expenses are taken care of, one has to fix on which is the top approach and position for them to invest their solid earned money.

Do you know? Only a percentage of the monthly income should go in investments.

– The amount put out for long or short term investments should not affect your daily lifestyle or liquidity.

– Next method of saving money is the bank. Banks offer you a set interest for the amount of money you deposit with them per month. The interest rate can be anything from 2 percent to 2.5 percent. Bank accounts are known to be the safest and most flexible.

– Bonds also good way for safe invests.

– Other than bank accounts, banks also offer ‘Certificate of Deposits’. Under this scheme, the banks offer a set interest for the amount of money you deposit with them for a set amount of time. The time span varies from case to case, but the general span is six months to two years.

– Investing money with bank there several best ways. For information take visit of bank.

– One more method of investing money is the stock market. One can buy stocks in a company as an investment in the company. Stocks are shares in companies which can be bought by individuals or other companies. The stock market has always given robust returns of investments. For example, a person can buy stocks in a company for $13 and the next day, the cost of the shares could be as high as $36 per share. This is a perfect example of ‘making a killing at the share market’. The stock market returns as much as ten to twelve percent annually.

– Risk Free Investment for the best way of going with money to the stock market is by investing a small amount and keeping it in the market for a while.

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