Hi Mr.G,
You started a good thread...this will help long term investors. keep updating this with good stock and value buys.
What I think is whenever we invest for long term, ensure that you invest only when market is down and stock is available at cheap price...usually people buy when the market is going up. This time when market went up to 6200 many retail investors would have invested because they see only the buzz that market is going up.they think it will go another 1000 points...
it may go but long term investor should see the stock as an asset rather than making money out of it in short term. I feel dividend is just like an interest for the investment you did...but main thing is capital appreciation of the asset which is what everybody wants. Yes. taking a consistent dividend providing company is the best idea for long term because without strong business they cant give you dividend. :thumb:
My philosophy when I buy every share is that I am buying myself a business. People do more research when buying a car than when buying a share.
I look at all my holdings as little money printing machines. They print money for me (Dividend), with that money I buy more machines. And over time my machines gain value aswell. ( Capital Gain) I dont look for capital appreciation as my main focus and I dont want that. I want my dividend to increase on a consistent basis. Eg. in Y1 cos gave me Rs.1 dividend, Next year I expect it to give me Rs.1.2 dividend. Find firms that do this and capital appreciation is bound to follow.
Firstly I would like to say that fundamental analysis is not as easy and simple as people think. It is a long slow grueling procedure of crunching numbers and qualitative facts. People invest on stupid logic and then say FA doesnt even work. People check balance sheet and see it is making profit, Chalo lets invest our whole life savings. When they lose they say FA doesnt work and we lost our money. Unlike TA, FA is only as good as the person doing it. It is like saying that "one day you go into gym and work out, next day you say MAIN DAARA SINGH BAN GAYA"
If someone has even little knowledge of FA and seen or even picked up never mind read an FA book they are 800 pages thick and that is just one book on one sub-part of FA. I have a shelf of thick thick books dedicated to FA and I have read them at least 3-4 times, before I even began to invest.
With my thread i will expel the notion that FA does not work and that FA is easy and every tom,dick and harry can do it. It takes years of study and practice and a stellar IQ to do anything with it.
"Good company give dividend, Great company increase dividend." -Ghanisht Nagpal