Disha Vyas
Rakesh Jhunjunwala famously called as the big bull by the media is a well-known figure in the area of stock market investing. He recently commented during a Q&A session at an international conference that investment is not an easy activity and requires time to develop. There are many like him who have made it big in the world of investing. In this blog we have looked at some of the timeless principles which shall enable readers answer a very important question of how to become a successful investor?
Have discipline
Discipline is important to excel in any area of life and investing is no different. Those investors who have regularly invested in equity markets through SIP in mutual funds in a disciplined manner have benefited the most as their wealth have compounded handsomely. Always work with a good advisor or expert to build wealth successfully by having a disciplined approach to investing.
Have patience
The worst mistake that most investors make is losing patience. They sell when price is low or even if there are minor corrections in the market. Investors would do well if they stop timing the market and spend time in the market. Investors who are able to do this will avoid the costly mistake of selling at the wrong time and benefit from the above average returns that equity markets gives over the long term.
Value v/s price
If one looks at the principles by Benjamin graham in his famous book Intelligent investor (you should read it if you haven’t) it mainly talks about making objective evaluation of the business and its value against the price you are paying. Value is what you get and price is what you pay.
Identifying value makes you look at data points like price to earnings, Book value, etc. A stock price might be 5000 but it would be trading at below its book value. This makes this stock more valuable than a stock which might trade at 5 rupees but whose net worth or book value is completely eroded. So always compare value with price you pay before investing.
Keep learning
Learning makes you wiser and keeps you informed. As warren buffet says ‘Risk comes from what you don’t know.’ Your competence and evaluation skills can be upgraded continuously by learning. For this you can start with staying connected with your wealth advisors, subscribe to blogs and content like this, read books on investing written by well-known investors like warren buffet.
Seek professional help
As with your health your wealth also needs a financial doctor. Experts help you minimize risks by suggesting optimum strategies and helping you diversify your investment across various instruments. Seeking professional help will help you avoid making costly mistakes that you might make and also help you save valuable time in this busy world.
If one follows the above principles then it would definitely help him or her accelerate the journey towards becoming a successful investor. Becoming a successful investor is a journey on which one has to begin with for a wealthy and prosperous life.
Follow our WhatsApp channel
