Stock Market for Investment minds

Stock Market for Investment minds

1. Books should always be the first step

Someone has rightly said-

"Books are One's best friend."

Some of the good books on fundamental analysis are as follows-

1. The Intelligent Investor by Benjamin Graham .

2. Competitive Strategy by Michael Porter.

3. The Essays of Warren Buffett by Lawrence Cunninghan.

4. Buffettology by Mary Buffett and David Clark.

2. Education is important

Fundamental Analysis is a vast subject which starts right from reading annual reports and sector reports to analyzing financial statement to the valuation of the company. It's better  to get proper education on fundamental analysis, equity valuation, and financial planning. 

3. Read annual report of companies

There can be no better piece of information about a company than annual reports. It may look like a collection of pages which companies send at the end of the year and reading it may seem to be a time consuming and boring job. However, it is a valuable piece of information about a particular company. In the annual report, the company's management discusses the important aspects about the company like industry performance, its vision for the long term, oppotunities and threats faced by the company, company's historical performance etc.

Some of the important things which we need to focus while reading the annual reports includes-

a. Chairman's letter.

b. Financial highlights- It gives a snapshot of the performance of the company.

c. Director's report and MD&A section.

d. Financial performance- It provides 10 years summarised track record.

e. Financial statements.

Few of the important areas where we should focus while reading annual and comparing the annual reports-

i. Debt scenario of the company.

ii. Salaries drawn by the key personnel of the company.

iii. Actions by the leading shareholders of the company.

4. Read good blogs and magazine

Blog's are a good source of learning in today's era where we are so busy with so many works. Reading blogs and articles helps you gain a lot of understanding on the subject and building storehouse of knowledge. 

5. Make idol and follow

There are so many learned investors across the globe whom you can follow and learn from them. Read their biographies or autobiographies, their lessons and investment techniques. Some of the well known investors whom you can follow are-

a. Warren Buffett

b. Charlie Munger

c. Jim Rogers

d. George Soros

e. Rakesh Jhunjhunwala