INVESTMENT ADVICE & STRATEGY
. EVALUATE THE COMPANY FIRST
The most lucrative way to make a competent investment is to evaluate the company in which an investor has
Investing in a stock isn't throwing your money into a poker pot and betting you'll magically become rich overnight.
While buying a stock investor is not buying a piece of paper you are becoming an owner of the company that stock represents.
For an instance, if someone investing in Reliance (NSE) and profits grow for the next few years, you'll be treated to a rising share price and grow wealthier along with your fellow owners. But if you invest in Reliance and the company does poorly over the next few years, your shares will lose value -- and you'll lose money on your investment.
To evaluate a company stock price you need to know about its book value, dividend yield with value of the dividend, debt, free cash flows and somewhere reserves which the company holds for future events.
some of the major points that one should see before buying the stocks are as follows:
Company should be debt free or considerable amount of is acceptable
Valuation should be cheap
Free cash value (cash that a company is able to generate after spending the money required to maintain or expand its asset base.)
. CASH IS THE BAD INVESTMENT
Cash will be worth less over time because of inflation. And even in developed economies, like the United States, where inflation is low, the cost of goods and services still outpaces the returns of cash investments. Some of the best savings account interest rates are centered in online-based accounts, but they still only provide an average of 0.85% in interest. While it's true that inflation will cut down the value of any asset over time, cash is the only one that has actually lost value.
"We always keep enough cash around so I feel very comfortable and don't worry about sleeping at night. But it's not because I like cash as an investment. Cash is a bad investment over time. But you always want to have enough so that nobody else can determine your future, essentially."
Having an emergency fund or back-up savings account is not bad, but it is also important to make your money work so to have better result and financial support with time.
. WAIT FOR THE RIGHT PITCH
Waiting for the right pitch of investment is crucial as investor may attain fundamental outcomes with the help of this phenomenon the best way to get lucrative results is to focus towards "long term plans" as from a pethora of companies if we get a company with better portfolio management which could provide us bettter results with time and is egregious competent company, than profit margins of any investor will get mushroomed as leading them to earn high profit margin.