Just like to lead a good life, to make money in stock market you need to know what to avoid.
As a kid, while I used to play amateur chess, I learnt an important lesson. You really don’t need grand strategies to win. You wait for your opponent to make mistakes & then checkmate. You wait. You simply play without making mistakes.
I’d say, majority of our research is focused mostly focused on avoidance. On what to avoid. We’ve a checklist on what not to buy. A don’ts list.
Here’s the indicative list, in stock market investing you should avoid:
1. Highly leveraged companies,
2. Loss making businesses,
3. Shady promoters,
4. Buying at extremely overstretched valuations,
5. Low or no margin of safety,
6. Companies with mixed bag of Fundamentals,
7. What’s hot stocks & sectors,
8. Constant bombardment of so called breaking news,
9. Close association with pessimists,
10. Buying on borrowed money (leveraged bets).
Keep doing above things & you’re bound to go broke no matter how much fresh capital you pump in your portfolio.
While people are scratching their heads to build complex quants, we focus simply on what to avoid.
If you simply know what to avoid & follow the above things, your returns would be boosted multifold times.
