Monday, February 17, 2020

Why a trader Speculator and Investors loses money in stock market

Why a trader Speculator and Investors loses money in stock market

1) No plan and process
2) No stop loss
3) No backtested strategy
4) No education
5) No patience
6) No time
7) No discipline
8) No willingness to learn
9) No mindset work
10) No mentor
11 )Yes to #Bluechannel
12)Yes to #SocialMedia
13) FOMO
14) COPYING OTHERS
15) ZERO FUNDAMENTAL RESEARCH
16) Intuitive AUTOMATIC DECISIONS
17) Greed and Fear


AND THE LIST IS ENDLESS and Check whether you fall in to this List

PROPERTY MARKET COMPOUNDING.......

Property Market......

High 1994......
High 2012.....
It took 18 years.....
But these rally started midway from 2003 started and lasted till 2012 so it was and lasted for 9 Years......

Next High 2030 if 18 years is taken in to account......

But the property market rally should start from 2023/2024 and last till 2028 to 2030.....
The price escalation will be almost like 3 to 4 Times from Current Market Prices.......

ASSUMING LUMPSUM PRICE OF A FLAT IN 1990 @1000000 COMPOUND @ 11.1% CAGR GROWTH WILL BE 2020 @22300000/-....COMPOUND STILL FURTHER FROM 1990 @11.1% TO 2040 @64000000/- AND SO IT GOES ON AND ON....
ACTUALLY THE PRICE OF YOUR FLAT IS DECREASING IN VALUE BECAUSE OF MONEY PRINTING BY THE GOVERNMENT......

MISERY OF FINANCIAL INVESTING.......


[10:35 PM, 2/15/2020] Jiten Patel: The Biggest Misery in Financial Investing is that NoBody Teaches you how to Adopt an INVESTING Strategy which Firstly Protects your Principal Invested.....

Every in the world speaks of Price rise Appreciation and PROFITS because of Price Escalation......

But the most Important Wisdom of Protecting your Money Invested in any Financial Assests is missing in all the dictionaries of all the Financial Analyst......So be careful when you are INVESTING  and give A First Thought to Protecting your Hard Earned Money...... because Generally the Thought of Greedy Profits comes First to our Mind and we miss out on the MOST IMPORTANT THING Keeping our Money Safe......
Calculating the Probabilities first is of Utmost Importance rather than Blindly taking a Emotional Decision because of your Greedy Brain Behaviours can make your Financial Status very Fragile and Precarious.....

COGNITIVE BIASES......

NTPC.......

[6:38 PM, 2/15/2020] Jiten Patel: NTPC should go between @ 800 to @1000/- by 2030 accounting for 4:50% dividend also...... generally if I am not mistaken the rate of return from a Utility Company is only 15% in the longer-term.....
In 2006 NTPC was @95/- and today it is @112/-.....
14 years NTPC STOCK has Underperformed and the Spring of the STOCK has been pressed downwards very Hard..... Believing that the Pressure on the Spring will someday will be Released and once it materialises the NTPC STOCK will start Galloping but it is a very long term story.....


But as of now it can go to 95/- also from current price.....

But as per above you have to be a Contrarian BORING Value Investors for long term.....

IT is my personal opinion and view only and not a recommendation to buy or sell and I reserved to be proved otherwise also..... please consult your Financial Advisor before Investing.....
[6:57 PM, 2/15/2020] Jiten Patel: Property Market......

High 1994......
High 2012.....
It took 18 years.....
The rally from 2003 started and lasted till 2012 so it was for 9 Years......

Next High 2030 if 18 years is taken in to account......

But the property market rally should start from 2023/2024 and last till 2030.....
The price escalation will be almost like 3 to 4 Times from Current Market Prices
[10:20 PM, 2/15/2020] Jiten Patel: The Biggest Misery in Financial Investing is that NoBody Teaches you how to Adopt an INVESTING Strategy which Firstly Protects your Principal Invested.....

Every in the world speaks of Price rise Appreciation and PROFITS because of Price Escalation......

But the most Important Wisdom of Protecting your Money Invested in any Financial Assests is missing in all the dictionaries of all the Financial Analyst......So be careful when you are INVESTING  and give A First Thought to Protecting your Hard Earned Money...... because Generally the Thought of Greedy Profits comes First to our Mind and we miss out on the MOST IMPORTANT THING Keeping our Money Safe......
[10:33 PM, 2/15/2020] Jiten Patel: Calculating the Probabilities first is of Utmost Importance rather than Blindly taking a Emotional Decision because of your Greedy Brain Behaviours can make your Financial Status very Fragile and Precarious.....

LONG TERM INVESTING AND THE POWER OF COMPOUNDING......

CORONA VIRUS ARTICLE.......

In few days or weeks the world will wake up to the Story of CORONA VIRUS and start beating the Markets downwards......
I hope the same story will play out and Once Correction sets in all news will be on CORONA VIRUS and it will be held responsible for Market Correction......

So Rational thinking says one has to be careful and stay away from market for few days and weeks.....

It is my personal opinion and view only and not a recommendation to buy or sell and I reserved to be proved otherwise also......
[9:58 PM, 2/11/2020] Jiten Patel: Actually it has already created lots of Economy problem in the world because China is the petrol and the world is the engine..... without petrol engine cannot START...

This realisation will come in hindsight
[10:00 PM, 2/11/2020] Jiten Patel: Because of CORONA VIRUS Epidemic sales of life insurance will zoom everywhere in the world because people will get scared and start buying Life Insurance Policies
Actually it has already created lots of Economy problem in the world because China is the petrol and the world is the engine..... without petrol engine cannot START...

This realisation will come in hindsight

With low crude prices still we are running at 4% deficit...... and this year we will cross 5% because 2,00,000/- crore rupees government is going to collect from Disinvestment in fy 20/21.....
Hope they sell BPCL....CONCOR.....etc......

MY LONG TERM STOCKS INVESTMENT......

[6:03 PM, 2/8/2020] Jiten Patel: mine long term 10/12 years portfolio....
Sun Pharma
Sun Tv
Heromoto corp
Power grid
Ab capital
Bajaj Consumer
NTPC

There is always a possibility of STOCKS going down from here.....
[6:03 PM, 2/8/2020] Jiten Patel: But this above mentioned STOCKS are going through rough patch but all are fundamentally sound STOCKS for long term Investing.....
[6:08 PM, 2/8/2020] Jiten Patel: The above mentioned STOCKS will definitely and surely underperform the current Bull Market but in the next 10/12 years the rate of return in the above mentioned STOCKS will and should be better......
My first principal in Investing is that your Principal Money Invested in the STOCKS should be safe guarded and thereafter i will think of capital gains from the price rise......

WHEN TO USE TECHNICAL ANALYSIS......

[12:16 PM, 2/7/2020] Jiten Patel: THE PROBLEM IN KNOWING TECHNICAL ANALYSIS.......
The basic concepts of technical analysis is to make a Trader continuously trade in Stocks and in Markets..... the genes of technical analysis itself works on the above basis.....
But the human beings psychology and biases works exactly the opposite of it.....
The more you Trade with the help of technical analysis the more your Neural Synaptic Network Circuits becomes stronger for technical analysis and more the Pleasure Chemicals of Technical analysis comes out of your brain and the more you want the Cocaine type hit of that pleasure chemical eventually...... finally because of the repetitive and continuous process of trading because of technical analysis becomes so unconscious without you becoming aware of it..... that your brain mind and body starts working automatically in Trading and Speculation without you becoming conscious about your trading and Speculative Decisions......
So continuously seeing technical charts become so ingrained within your brain mind and body and the biological pleasure chemical which comes out  automatically generates the highest emotional feelings to trade and speculate when we see a Technical Patterns in charts which we interpret will gets us PROFITS......
But Brain mind and body is not concerned at all with the Profits and Losses you are incurring it is most concerned with the biological chemical of pleasure of Seeing Charts and jumping into a Trade......
So it is best for our financial health and for our brain mind and body to see technical analysis Charts not on regular basis and only when the need arises when a good opportunity is thrown by the market either to buy or sell.....
Technical analysis should be used only with Fundamental analysis which should constitute 80% of your buying and selling Decisions and the rest 20% should constitute of technical analysis for getting still better prices after the buying and selling Decisions is made on the basis of Fundamental analysis.....
Rest following technical analysis in isolation will not get you the results which you are looking for and it will be a complete waste of time and mental energy......
[1:10 PM, 2/7/2020] Jiten Patel: Everything we do continuously and repetitively finally becomes our habits and behaviours which makes our personality traits......
So the more we trade continuously and repetitively become very strongly ingrain in our biological systems and it finally becomes our personality traits....
And it is proven historically the more we trade and speculate the more are our Probabilities of making LOSSES because the market is full of Stories and Noises and we most of the time make and take our Decision on market Stories and Noises which are thrown towards us by Markets in Abundance......
So it is best to follow the principles of avoiding to see the market on daily basis....
Easy said than done.....but Investors who Invest in good fundamental companies and avoid looking at the Market for months and years are the ones who make a KILLING IN THE RETURNS from thier long term INVESTMENTS

NIFTY LEVELS AND GSEC 10 YEARS @6.36%.....

[12:19 PM, 2/6/2020] Jiten Patel: Friends once again i am sending you the above Long term chart.,....
Nifty is in Channel Trading Range.,....
Channel Trading Range currently of NIFty is between @12500 and @11000......

The upper Trendline  is the Resistance of the trading range @12500
The Lower Trendline is the Support Trendline of the Trading Range @11000......

When NIFty breaks the upper Resistance Trendline Convincingly and travels upwards then NIFty can travel to @14000.....
When NIFty breaks the Lower support Trendline Convincingly and travels downwards then NIFty can travel to @9300.....

But if the  current Channel trendline of resistance and support are not broken then NIFty will be Range bound between @12500 to @11000.....
So happy Investing......

IT is my personal opinion and view only and not a recommendation to buy or sell and I reserved to be proved otherwise also...... please consult your Financial Advisor.......

[2:43 PM, 2/6/2020] Jiten Patel: GSec have to go down to 5:50% then only the Economy will start moving...... right now it is @6:50%..... for Economy to move credit Growth has to go up and Interest Rates have to go down...... otherwise nothing is going to happen..... Economy will run in sideways phase

BOOK YOUR LOSSES.....

[11:03 AM, 2/6/2020] Jiten Patel: This are Golden Words always remember in your life...... and never ever hesitate to take a lose whether Big or Small.....but get out of such situations and win over your BIASES which doesn't allow you to book losses
You always have to cut your losses in whatever situation you are like you have to remove a cancerous Brain Tumour.....Losses and debts are like Cancer.....they will always kill you......
So important thing is you CUT YOUR LOSSES.....
and let YOUR PROFITS RUN TO INFINITY.......

POWER OF COMPOUNDING......

[5:10 PM, 2/5/2020] Jiten Patel: Does it make sense to buy @4090 its lifetime high price or @ 2325 and if it falls to @2000 then i will buy more...... because it is becoming more cheaper....

@4090 in 10 years @7% you get 8040

@2325 in 10 years @13.25% you get 8040

@1800 in 10 years @16.15% you get 8040

But AVERAGING is worse From EUPHORIC  top market price..... AVERAGING is good at Bottom price

BROAD NIFTY LEVELS.....

[12:10 PM, 2/4/2020] Jiten Patel: Nifty has formed a Channel and as well as a RISING WEDGE on long term basis.....
Trading range for NIFty on long term basis is between @12400 and@11000....
Any break up above the resistance line of 12430 can take NIFTY to Higher levels and any break down below the support levels @11000 can take NIFTY to still Lower Prices levels.....
But long term Range of NIFty is now the above mentioned price levels and a Trading Range is formed.......
[12:46 PM, 2/4/2020] Jiten Patel: Breach of resistance Trend channel line on upside will take NIFTY to @14000.....
Breach of Support Trend channel line on downside will take NIFTY to @9600.....

It is a long way to go as of now and there can be change in NIFty TGT lvls depending how much time NIFty is within the channel trading range.....

But as of now the trading range between @12400 and @11000 should be respected for few weeks or months......

IT is my personal opinion and view only and not a recommendation to buy or sell and I reserved to be proved otherwise also......

CREDIT FLOW.....

Credit Growth of SBI for FY 2019/20 was paltry 7/8 % only......So one can imagine for other PSU BANKS......it has to be less than SBI BANK.....
Very less capital is available for the Corporates......
At peak of the economy growth the very same SBI BANK Credit Growth is some where around @18%.....yes almost double.....when the Economy is moving ahead at full throttle.....

So i am going one step ahead that we have reached the Trough of the Credit Growth Cycle as of now.....and maybe even one more year we might still see the pain of poor Credit Growth Cycle...... but this cycle has to eventually turn 180%.....

But the exact time is very difficult to same when this will happen.....but for Long term Investors this can be a Big Uptrend opportunity who can wait for 8/10 years......

DISPOSITION EFFECT.....

[7:48 PM, 2/2/2020] Jiten Patel: Why Investors book profits earlier and let your losses run to infinity......

There are two aspects of this fallacy which are gifted to us by Evolutionary mechanism....

Disposition Effect.....The disposition effect is an anomaly discovered in behavioral finance. It relates to the tendency of investors to sell assets that have increased in value, while keeping assets that have dropped in value.....

Booking Profits.....one of the reasons we book profits is because of INSTANT GRATIFICATION..... we are constantly in a flux to decide between Reward and Punishment.....NOW OR NEVER..... Because in Savannah forest millions of years ago before we evolved into human beings..... when we were migrating from apes to human beings getting and gathering food was a big difficult task..... because we had no tools to even hunt and kill Animals to eat.....also in the food chain we were the last link.....even fruits on trees were a delicacy for our ancestors......
So whatever food we found was to consume immediately.....Now or Never..... because other animals were always around and we had the fear of being hunted and killed by wild animals.....so Instant Gratification in those days was the need of the hour for Survival.....the more you consumed food the better chance of survival and to pass your genes to the next generation..... Now this Evolutionary gifts of Now or Never and Instant Gratification in today's complex world get's us to become biased to many things which are of irrelevance.....
In those days the question was of Survival for food water shelter and sex.....but today all these things have become irrelevant in the modernise world where the above things are available in abundance.....

But because of Evolution all this biases and Heuristics and fallacies have been gifted to us through our genes and passed on to us by our ancestors.... and it will go on and on.....to next generations.....

Now why do we let our losses run to infinity.....
The pain of a lose is double that of the Gains....if we lose 50000 rupees the lose will be bigger and very disturbing than the gain of 100000.....losses are twice as powerful, psychologically, as gains..... this is because of Loss Aversion.....
Losses are Neurologically processed in the brain parts Insula ACC and Amygdala.....
Amygdala part of the brain is the most important which activates when you are faced with Danger....that is when your survival is in question..... now in today's complex world Losing Money also being processed in the above 3 parts of the Brain and the Process of taking a Monetary Loss activates this Limbic Survival parts of the Brain which is responsible to keep you out of Danger....So the Moment you take a decision to cut your losses this fear centric Amygdala part of the Brain starts firing and doesn't allow you to take the Decisions of cutting your losses because monetary loss is a dangerous thing for the Brain and for your well being and also there is a hope that recovery is on its way......So the brain confuses between the real Danger to life and Monetary Loss and treats them as one...... So it takes all the steps to stop you to book and cut your losses.....

Humans may be hardwired to be loss averse due to asymmetric evolutionary pressure on losses and gains: for an organism operating close to the edge of survival, the loss of a day's food could cause death, whereas the gain of an extra day's food would not cause an extra day of life (unless the food could be easily and effectively stored)
[9:19 PM, 2/2/2020] Jiten Patel: From planting a seed in the ground and GIVING Water doesn't mean the next day Full blown tree will grow....
Learn to ride a bike today doesn't mean next day you will start riding at 100km/hr....
Making a new friend today doesn't mean he will be a true friend and stick with you for the rest of your life
Learn to cook today doesn't mean you will be able to make pav bhaji tomorrow
Learning to write ABC doesn't mean next day you will start writing Sentences......
Learning to take your first step doesn't mean the next day you will start running.....
Learning to play cricket doesn't mean you will start playing for indian team.....

Than without learning what F&O trading and Speculation is why the very next day you want to Start Trading in F&O.......
Than without learning why do you want to invest your hard earned money in stock market.....

So everything in life needs learning and waiting for things to develop......to grow.......

NEUROLOGY....

[8:51 AM, 1/22/2020] Jiten Patel: How Your Brain’s Reticular Activating System (RAS) Determines Your Success

How Your Brain’s Reticular Activating System (RAS) Determines Your Success
The reticular activating system is a bundle of neurons found in your brain, usually the size of your little finger. It acts as a filter and decides which information is important, and which isn’t, thus conserving a lot of energy. Some people think that the key to success lies in the reticular activating system. In short, utilizing its full potential can mean the difference between living the life you want and being stuck in a terrible routine.

1. How does the RAS work?
It helps to think of the reticular activating system (RAS) as a gatekeeper of your brain. Its job is to sort through the massive amounts of information delivered to you by your sensory organs. Some of these stimulations always get through, for example hearing your name called. However, there is information that your brain can do without and the RAS makes the decision to dismiss it. Basically, the RAS lets in information that you are already focused on. When you learn a new word, you keep hearing it everywhere. If you like a certain type of phone, you notice more and more people using it. This is due to the fact that when you first encountered these things, they left an impression, so now the RAS keeps alerting your brain every time you notice them.



2. The Power of Visualization
While some may think that daydreaming is wasted time that could have been used otherwise, it can actually help you train your RAS. The more you ‘daydream’ about your goals and the desired outcomes, the bigger your chances of reaching them. All of this is graphically explained in this video. Imagining your future means that you are gradually programming your RAS to focus on your goals and ways to achieve them. Clearly identifying your goals will signalize that this is something important and meaningful, so the RAS will begin to focus on it. Over time, it will learn to pick up on clues and hints in your environment that will help you accomplish your objective. Without the help of your RAS, this important sensory information may be discarded and never delivered to your brain. The RAS is not a superpower; it’s just a part of your body that will do what you incline it to do. If you think about a point in your life that you want to reach (employment, travel, marriage), your RAS will detect that this is essential to your life and do a better job at focusing on these things.

3. Visualization Techniques
Success rarely comes in a tangible form; it’s more of a concept. This is why some aspects of your future may be hard to imagine or play out in your mind, so basic visualization doesn’t cut it. The most effective method for practical visualization seems to be writing your goals down on a piece of paper. In this way, you are simplifying and conceptualizing your objectives. If you want to be more creative, here are some other daily techniques you can use:

send yourself an email with your goals or tasks
display your target on your phone or computer wallpaper
keep a journal outlining your plans
place sticky notes where you can see them
create a vision board with magazine cutouts and inspirational quotes


4. Start Working
Contrary to popular belief, the RAS will not attract success on its own. It’s only when you start moving in the right direction will the RAS show you the big opportunities. For example, if your goal is starting your own business, then make it a habit to spend one hour every day working on your business idea. And if you don’t have one, educate yourself about businesses. After sometime, you’ll learn how to attract small-level clients. And as you gain experience and remain focused on the big vision, the RAS will soon show you the “big opportunity” one day. You will suddenly find a high-paying client after toiling hard for months on. This client may help you establish your brand in the market and from there on, you’re set for success. So what’s the key here? The key is to realize that the opportunities RAS shows you are relative to your efforts. It won’t show you the big opportunity right away. You have to follow its trail. Follow the small ideas (self-education, learning through small-level clients) that need you to work on them. Then once you start working, the big opportunity (premium clients) will be revealed.

Conclusion
The reticular activating system is a powerful tool that nature has given us. While its function seems quite simple, there are many ways you can take advantage of it. If the RAS can help you focus on your desired smartphone or car then why not train it to focus on your education, job, family or house? It’s potential has no limits and it would be a shame to waste it.
[9:17 AM, 1/22/2020] Jiten Patel: Have you ever banged your head against an intractable problem, only to have it solved much later, usually in unrelated circumstances? Have you ever experienced l’esprit de l’escalier? This is your RAS at work… and it’s about time that you paid it a better salary and gave it some working conditions where it can work even more productively.

Your RAS is a powerful parallel processor, a relatively slow computer that can solve complex problems and arrive at novel insights, seemingly out of nowhere. The trick is to program it correctly and then give it the time and context that it needs to do that work… all while you get other stuff done.

Once your train your RAS to pay attention to something, you’ve effectively outsourced the task of thinking to your subconscious, which can work in parallel to your day-to-day (and night-to-night) activity (and dreaming).

Here’s how it works:

Decide on it. Choose the idea you want to embed into your subconscious– it could be a concept, a theme, a person, a narrative, a process, a problem, an entire project or relationship — so that your RAS can go to work on it, looking for solutions and insights.
Immerse in it. Consciously immerse yourself into the idea — mentally and emotionally. Start thinking about it a lot… vividly… attach strong feelings to it… do this for a while… repeatedly. The required number of hours and days of focus and repetition will vary by the quality and salience of the idea, as well as the quality of your brain and self-training efforts. You can even try a mini-immersion exercise: write or blog about something for a couple of hours, and then…
Sleep on it. Consolidate the memories. The deeper layers of your brain need time for it to soak in.
Walk away from it. Put yourself in a different, atypical environment — new sights, sounds, smells, tastes, feelings — new stimuli that (a) distract your conscious mind, and (b) give your RAS a new context to begin actively scanning for the presence of your idea.
Let the brain magic happen. This is usually where the lateral thinking process kicks in — at seemingly random moments, you’ll become aware of all sorts of comparisons and analogies between the thing you programmed your RAS to look for and the new things that are appearing in your changed environment. Every time you get one of these lateral connections, make sure to reward your RAS’s efforts by giving yourself a mental smile and pat on the back. Good RAS doggie.
If you’ve done this for a while you’re still not getting anywhere, repeat step 1.
[11:57 PM, 1/22/2020] Jiten Patel: The best thing you did today was you took a decision...... whether right or wrong that is debatable and you will know the results only in hindsight.....

But 98% of the people are living and dying in the same state of not taking a Decision and maintain the same status quo and live in their Comfort Zone..... most of the time people are afraid and are confused to take Decisions and to make choices and are apprehensive to move ahead in uncharted territory......but people who do not care about the results are the ones who eventually be successful in life......


 it is also important to know that life is a challenge and always evolving...... Nothing comes easy in Life......but the best thing is do what you like the most and keep moving forward......
[11:57 PM, 1/22/2020] Jiten Patel: THINKING DIFFERENTLY AND TO HAVE  IDIOSYNCRATIC THOUGHT PROCESS IS THE MOST IMPORTANT THING WHICH YOU SHOULD BE WORKING ON ......REST IS ALL BY PRODUCTS.......
[11:57 PM, 1/22/2020] Jiten Patel: Mahatma Gandhi..... Nelson Mandela.....Abdul Kalam..... Sachin Tendulkar..... Thomas Edison..... Steve jobs.....Nikholas Tesla all had their ups and downs in life but they kept on moving forward.....
Don't and never worry about the results..... just keep on working and keep on moving forward......
Nobody in the real world cares about marks and grades.....
People just want to know how much passionate and creative you are about the things you know and Love to do......

LEARNING.....

Alcohol math. Wine multiplies itself by itself. The more you have, the more you are likely to have. And if it’s hard to stop at one glass, it will be impossible at three. Addition is multiplication. ~ Matt Haig, Reasons to Stay Alive

Debt math is exactly like that. The more you have, the more you are likely to have. And if it’s hard to stop early, it will be impossible later.

Economics has a term for this – debt spiral, which is a situation where an individual, or a business, or a country sees ever-increasing levels of debt. This increasing levels of debt and debt interest becomes unsustainable, eventually leading to debt default.

See this chart.
Debt Spiral - Safal Niveshak

In 2004, at the Berkshire Hathaway AGM, a 14-year old shareholder asked Warren Buffett to share his top finance tips for young people.
Buffett replied –

If I had one piece of advice to give to young people, it would be just to don’t get in debt. It’s very tempting to spend more than you earn, it’s very understandable. But it’s not a good idea.

The big problem with debt is that it is easy to accumulate, but difficult to pay down. Whether you borrow as a business, or an individual.

Now, the reason debt is so much ingrained in our life is because it is older than money. In fact, as per David Graeber who wrote in his book titled Debt, money was probably invented not to help people struggling with barter, but instead to enable nation states to feed their armies, and for individuals to trade debts with one another.

So, how much ever you may want to get away from it, there is a risk of it lurking around the corner that you must watch out for. And also because one of the most lethal characteristics of debt, like drugs, is that it generally starts small, then slowly creeps into your life making you sort of an addict through the instant gratification it generates, and then takes you over.

The worst part is a lot of people take on debt not just to gratify themselves instantly, but also to gratify themselves more, and faster, than their neighbours and friends and colleagues.

Anyways, when it comes to debt and investing, here is a note from Tren Griffin of 25iq that explains it all –

Debt causes many problems, the worst of which is that the magic of compounding is working against you instead of for you. Leverage can also create situations where underperformance takes you completely out of the investing process. Since “staying invested” is a key to financial success anything that takes you out of the process is a very bad thing. As Charlie Munger has said: “I’ve seen more people fail because of liquor and leverage – leverage being borrowed money.” James Montier adds: “Leverage can’t ever turn a bad investment good, but it can turn a good investment bad. When you are leveraged you can run into volatility that impairs your ability to stay in an investment which can result in “a permanent loss of capital.”

In short, the math of debt is almost never in your favour, whether you take it in your personal life or for investing.

And like Matt Haig wrote for alcohol, even with debt, the more you have, the more you are likely to have. Addition is multiplication.

Paying interest on interest is a long-term trap


cORRECTION IN USA S&P500 BECAUSE OF THE PARABOLIC RISE......

18/1/2020: Once s&p500 reaches @3550/3600 a 20% correction can be expected in S&P 500.....
And when s&p500 reaches the above tgt lvls NIFty will also reach its top Levels..... and same correction should happen in NIFty

ECONOMIC SPRING AND THE BOOM TILL 2028/2030

The spring of the Indian Economy has been compressed for a long long time..... sooner or later maybe within one year time this Indian Economy spring is going to be released and the day it starts to release one will release the true Power..... because when the spring which is pressed so hard and tightly and when that spring is released you know what happens.....it will bounce back with great velocity and the jump is also Big......
Yes this Physics also apply to Economics and specially when human beings are the Actors and participants having full Emotions......
Also the same rules apply for Credit Flow in the Economy.....the spring will have to be released and government is already working towards it ......its matter of time when the NPAs issue gets solved and starts making lesser noise is the time for party Rock n roll......

So believe in the Indian Economy before it is to late.....

Credit growth in the month of December 2019 was paltry 7%.....it is one of the lowest in many years....ie the Banks are lending less tody because of the Fear psychosis prevailing in the market and also because of the Strong Government steps to check there are no further Defaults and to check Corruption in Lending Practice which was in abundance few years back.....
But eventually this Strict Stringent Lending Practice will eventually give way to more liberal Lending in the future.....
The Lending Growth Cycle at Times of Prosperity and at its peak shoots up to 18%.....
So we are at the trough of the Credit Lending Growth Cycle and eventually it will tuy for sure but when it will turn No One Knows for sure....
[9:25 AM, 1/9/2020] Jiten Patel: The Spring of Lending Credit Growth was pressed so hard because of GST.....DEMONETISATION........RERA ..... CLEANING OF CORRUPT LENDING PRACTICE......BANKS NPAs..... PSYCHOLOGY OF HUMANS..... CREDIT CYCLE.... GEOPOLITICAL....and there are many more......
Eventually all this factors will play out in next few years but THE FUTURE TREND WILL BE GOOD AS WE HAVE ALMOST REACHED AT THE ROCK BOTTOM......

Saturday, February 15, 2020

Debt

https://www.bloombergquint.com/amp/mutual-funds/the-mutual-fund-show-benefits-of-staying-invested-in-debt-funds-for-long-term

Friday, February 14, 2020

Long-Term COMPOUNDING Investing Mantra

Long-term investing mantra: 3 reasons why Sensex could be at 1,00,000 by 2028-2030
Assuming a real return of 5-7% for equities as seen from global and Indian evidence, we can work out a rough return expectation of around 10-12% for equities over the next 10 years.
https://www.moneycontrol.com/news/business/markets/long-term-investing-mantra-3-reasons-why-sensex-could-be-at-100000-by-2028-2030-4940631.html

https://www.moneycontrol.com/news/business/markets/long-term-investing-mantra-3-reasons-why-sensex-could-be-at-100000-by-2028-2030-4940631.html

Wednesday, February 12, 2020

RATE OF RETURN OF FINANCIAL ASSETS......BIBLE .....GEETA.......

LONG TERM AVERAGE RETURNS....



GOLD ====FROM YEAR 1925 TO 2020 LONG TERM AVERAGE RATE OF RETURN @8.45%...... 

PROPERTY ====FROM YEAR 1990 TO 2020 LONG TERM AVERAGE RATE OF RETURN @11.2%...... 

STOCKS ====FROM YEAR 1980 TO 2020 LONG TERM AVERAGE RATE OF RETURN @15.50%...... 

Tuesday, February 11, 2020

HUMAN BIASES................

https://www.youtube.com/watch?v=Jm2MCS75wU8

https://www.iflscience.com/brain/58-cognitive-biases-that-are-screwing-up-everything-you-do/

WHY FIRST IMPRESSION IS LAST IMPRESSION....

Understanding the Primacy Effect...................Have you ever been asked to memorize a list of items? Or just been given a list of items that you tried to remember? If so, you might have noticed that it's easier to remember the very first items and the very last items on the list, but the ones in the middle are a bit hazy. This is due to something researchers refer to as the "primacy effect."
What Is the Primacy Effect?
In simplest terms, the primacy effect refers to the tendency to recall information presented at the start of a list better than information at the middle or end.
Memory Limitations
Finally, the primacy effect likely persists because of limits in memory. A person might be able to store those first few items to long-term memory, and those last few items might reside in short-term memory, but the ones in the middle never get stored.

Decision Making for Complex Choices

One important takeaway is that the way in which we receive information is a critical factor during complex decision-making processes. This might come into play when making a large purchase or an important decision in our lives.
Marketing experts are aware of this cognitive bias and use it to their advantage. They want your first impression and the last impression of a product to be positive. This is why you will see advertising for a product that is not yet available. It is also why a company will add extra finishing touches such as special packaging for a product. They want your first impression and last impression to be positive because these are the things that will matter.
It's important to be aware of this if you are making a complex decision. Instead of being led by marketing, do your own research and keep it in the forefront as you weigh your options. This will make it less likely that you will fall prey to advertising and marketing strategies.