Eight Simple Rules for Investing:

By | November 6, 2015
  1. Do your own investing and don’t think mutual funds are the safe and sane road to riches.
  2. Don’t try to predict what the market will do, which is almost next to impossible. Even a vetern investor never knows ahead of time which stocks will be winners.
  3. Don’t churn too much or overtrade. Overtrade incur you lots of costs as well as attracts taxes.
  4. Don’t sell your winners too soon.
  5. Don’t worry every time one of your stocks drops a point or two. That is what stocks do. They go up, they go down over the long period they go up. But they do not do it every day.
  6. Avoid extremes in dividend yields (particularly lower side) also avoid extremes in PE or PB ratios.
  7. Take out tax, brokerage issues in your mind. Concentrate growth of the portfolios. Never hesitate to take a decision just because of tax or brokerage issue.
  8. Try to manage a small portfolio of stocks which should be easy to manage, hold or sell your stocks at any given point of time.