Porinju Veliyath, founder and CEO of Equity Intelligence India has some advice for people who believe in making investments. Veliyath suggested not buying stocks just because they are held by reputed investors. It is because one doesn’t really have an idea of the cost paid by famous investors while buying the stocks and what reason they chose that stock plan. The experienced investor himself Veliyath shared an example of India’s Warren Buffet i.e. the late Mr. Rakesh Jhunjhunwala who passed away in August 2022.
Veliyath said how the late Jhunjhunwala had earlier accepted on the public domain that there are more failures than successful shares and this is the advice that is applicable to each investor. Veliyath shared his views in an interview with a finance media portal. He explained how there have been times of successful shares like Titan but there are also failures more than regular successes.
He also shared the story of Charlie Munger, vice chairman of Berkshire Hathaway who had advised investing in Alibaba, which is one of the famous Chinese e-commerce and technologies companies to be one of the biggest stock investment mistakes he made.
Veliyath reminds us how investments done in the stock market have their own levels of risks and uncertainties. He also mentioned how every stock will not always give positive results. However, he also stressed the fact that failed ideas can be converted into successful opportunities over the course of time. Failures are also required when a person owns many stocks for a short duration. His own investment journey has been described by him as a 90% success rate with 10% misses.
It is indeed a fact that one needs to follow certain investment tips while being a part of the stock market.
1) One needs to have a good understanding of the stock markets. If you are a beginner and have no idea of how the stock market works, then apply for online courses or consult experienced professionals who have been investing in the stock markets for a long time. You will never fail if you hold the right hands in your life.
2) You need to have an understanding of your risk profile and investment goals. Just don’t read newspapers or random blogs and think that you know it all. You have to take calculated risks and work accordingly.
3) Have your own analysis despite listening to all. If you don’t do your homework well, then you will be taken for a ride by financial professionals who work in the industry. So, it is better to invest or trade only when you have complete knowledge. Half knowledge is really dangerous – hope the OTT series or movies on stocks gave you a brief idea.
4) Select stocks of well-established companies but don’t expect too much at one go. Everyone fails and makes mistakes – so take it easy on the misses and failures that you will encounter in your investment journey. Last but not least, never make any decisions in stock markets on an emotional basis, because it is all numbers at the end of the day, which has no relation with human feelings.