Uncertain times create stress in all of us. The causes of worry are manifold. For someone, it is the sinking value of investments made over time in the stock market. The last few sessions have blown away everything you had gained. Many are in grief when they see the levels to which their stock values have fallen. For others, the job scene is a source of stress. From walking around exploring numerous job offers- each one more lucrative than the other- to lying low and hoping that your name is not in the next list of lay offs, is a sea change.
The stock market has been the talk of the town for the last few months. The Sensex shot past the 20000 mark and every man and his neighbour wanted to make a killing in the stock market. In such a context, I found an article in the Economic Times very useful.
As they say, the first rule to investing is ‘Don’t lose money’. The second rule to investing is ‘Don’t forget rule no. 1’! It is essential to stick to these rules when it comes to investing, in order to avoid the possibility of capital erosion.
To apply these rules successfully and to create wealth through equity investing, Raamdeo Agrawal, Director & Co-founder, Motilal Oswal Financial Services identifies a 5-step guide to locating a ‘wealth creator’ , Here are the 5 parameters that you must evaluate:-
1. Assess the entry barriers created by a company
2. Management should be competent and passionate
3. Management should have integrity
4. Buy low
5. Have patience
Read the article to understand why these tips can make you a wise and successful investor.