Elearnmarkets - Financial Market Learning
  • Categories
    • Basic Finance
    • Derivatives
    • Financial Planning
    • Fundamental Analysis
    • Technical Analysis
    • Marketshala
    • Miscellaneous
  • Language
    • English
    • Hindi
    • Bengali
No Result
View All Result
  • Courses
  • Webinars
  • Learn On Elearnmarkets
Elearnmarkets - Learn Stock Market, trading, investing for Free
  • Categories
    • Basic Finance
    • Derivatives
    • Financial Planning
    • Fundamental Analysis
    • Technical Analysis
    • Marketshala
    • Miscellaneous
  • Language
    • English
    • Hindi
    • Bengali
No Result
View All Result
  • Courses
  • Webinars
  • Learn On Elearnmarkets
Elearnmarkets - Learn Stock Market, trading, investing for Free
No Result
View All Result
Home Basic Finance
5 Mantras of Value Investing 1

5 Mantras of Value Investing

Elearnmarkets by Elearnmarkets
November 24, 2021
in Basic Finance, Capital Markets
Reading Time: 5 mins read
0
3.5k
VIEWS
Share on FacebookShare on TwitterShare on WhatsApp

Bengali: এই ব্লগটি এখানে বাংলায় পড়ুন।

The short-term traders often end up naming their loss-making trades as “Investments” because they lack the discipline to cut their losses. This is one of the very big mistakes which people commit in the stock market. So it’s very important to stick to your discipline. This is not an appropriate way of making long-term investments. Want to learn about where to invest, how to invest, when to invest? Know all the answers with the NSE Academy Certified Equity Research Analysis course on Elearnmarkets.

Following are the few important points which an investor should keep in mind before making a long-term investment:

albert-einstein-compound-interest-eighth-wonder-world-millionire-down-the-road(Source: www.millionairedowntheroad.com)

Powerful Mantras of Value Investing

1. Power of compounding 

Investors like Warren Buffett, Charlie Munger, Rakesh Jhunjhunwala etc always believe in long term value investing because they understand the power of compounding. Equities over a long term time frame have always outperformed the broader asset class. As Warren Buffet says-

Our favourite holding period is forever.

The benefit of compounding works very well for long term investments. Say if someone invests $1 today compounding at an annual rate of 20% p.a. will result in $15.41 in 15 years, $38.34 in 20 years and $95.40 in 25 years. We can clearly see that more is the number of years, the better is  the result from compounding.

Join TMP Join TMP Join TMP

Know More:  How Does Power of Compounding Work

If you aren’t thinking about owning a stock for 10 years, don’t even think about owning it for 10 minutes – Warren Buffett.

quote-a-margin-of-safety-is-achieved-when-securities-are-purchased-at-prices-sufficiently-seth-klarman-64-16-92(Source: www.azquotes.com)

2. There should be a margin of safety

 There should always be a margin of safety in whatever you buy because it reduces the risk and gives you a cushion in case of any unforeseen negative events in the future.

It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price – Warren Buffett.

So, it’s always advisable to buy a stock below its intrinsic value in order to get the margin of safety. Even the finest business could be a bad investment if bought at a huge premium.

quote-never-invest-in-a-business-you-can-t-understand-warren-buffett-61-32-67(Source: www.azquotes.com)

3. Invest in a business you understand i.e. it should be in your circle of competence

It is very important to invest in a business which is simple and easy to understand. The reason is understanding the business well can help you identify any trouble lying on the way. So the chances of losing will be very minimal which is a very important aspect of investing and as Warren Buffet says- 

Rule No. 1: never lose money; rule No. 2: don’t forget rule No. 1

quote-the-game-of-investing-is-one-of-making-better-predictions-about-the-future-than-other-charlie-munger-73-2-0250(Source: www.azquotes.com)

4. Look for companies with a moat

Always try to invest in companies with moat i.e. with some competitive advantage which may be due to barriers to entry, brand name, pricing power etc.

The presence of moat acts as a barrier against other companies seeking to enter into the industry and thus enjoying the supernormal profit.

 Read More: Moats vs Floats

Companies like Colgate, Pidilite, Ajanta Pharma, Kitex garments, Page industries etc are amongst the companies with a moat which are listed in the Indian Stock Exchange.

5 mantras of value investing

5. Keeping the idle cash

Keeping cash in hand is a very important aspect of value investing because, given the high volatility in the equity market, there are times when the stocks are available at throwaway prices.

There’s a very famous quote-

Buy when there’s blood in the streets, even if the blood is your own

So in order to buy at those times, it is very important to have cash with you.

Also Read: Holding Cash- an important decision

Bottomline:

We hope that the above write up has helped you to get a brief idea of the 5 important mantras of value investing.

You should develop your own value investing style rather than imitating the investment style of any famous value investor.

Happy Learning!!

 

Tags: englishinvestinginvestment basicsstock marketTime Value of Moneyvalue investing
ShareTweetSend
Previous Post

PSU Banks Rally on Reforms

Next Post

Indian Markets flat, Amtek Auto Ltd crashes 30%

Elearnmarkets

Elearnmarkets

Elearnmarkets (ELM) is a complete financial market portal where the market experts have taken the onus to spread financial education. ELM constantly experiments with new education methodologies and technologies to make financial education effective, affordable and accessible to all. You can connect with us on Twitter @elearnmarkets.

Related Posts

5 Best Practices in Your First Year of Stock Market Trading 2
Basic Finance

5 Best Practices in Your First Year of Stock Market Trading

May 15, 2023
1.5k
Understand the MSCI Index and its Rebalancing Impact on the Indian Stock Market 3
Basic Finance

Understand the MSCI Index and its Rebalancing Impact on the Indian Stock Market

May 12, 2023
2.2k
Tax Planning - 7 Changes in the Indian Financial Environment that you need to know this Financial Year! 4
Basic Finance

Tax Planning – 7 Changes in the Indian Financial Environment that you need to know this Financial Year!

April 18, 2023
1.3k
Last-Minute Tax Planning- 5 Common Mistakes that Taxpayers Make 5
Basic Finance

Last-Minute Tax Planning- 5 Common Mistakes that Taxpayers Make

April 12, 2023
1k

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Follow Us

Facebook-f Twitter Instagram Linkedin-in Youtube Telegram

Register on Elearnmarkets

Continue your financial learning by creating your own account on Elearnmarkets.com

Register Free Account

Download App

Categories

  • Basic Finance
  • Derivatives
  • Financial Planning
  • Fundamental Analysis
  • Technical Analysis
  • Marketshala
  • Miscellaneous

Popular On Elearnmarkets

  • Market Superheroes:
  • Vivek Bajaj
  • Chetan Panchamia
  • Ashish Kyal
  • Premal Parekh
  • Abhijit Paul
  • Jegan
  • Sivakumar Jayachadran
  • Vishal Malkan
  • Jyoti Budhia
  • Vivek Gadodia
  • Vishal Mehta
  • Piyush Chaudhry
  • Santosh Pasi
  • Gomathi Shankar
  • Market Superheroes:
  • Vivek Bajaj
  • Chetan Panchamia
  • Ashish Kyal
  • Premal Parekh
  • Abhijit Paul
  • Jegan
  • Sivakumar Jayachadran
  • Vishal Malkan
  • Jyoti Budhia
  • Vivek Gadodia
  • Vishal Mehta
  • Piyush Chaudhry
  • Santosh Pasi
  • Gomathi Shankar
  • Courses:​
  • Options Trading
  • Dow Theory
  • Momentum Trading
  • Stock Investing
  • Stock Market for Beginners
  • Harmonic Chart Patterns
  • Algo Trading
  • Elliot Wave Theory
  • Advanced Excel
  • Cryptocurrency
  • NSE Certification Course
  • Courses:​
  • Options Trading
  • Dow Theory
  • Momentum Trading
  • Stock Investing
  • Stock Market for Beginners
  • Harmonic Chart Patterns
  • Algo Trading
  • Elliot Wave Theory
  • Advanced Excel
  • Cryptocurrency
  • NSE Certification Course
  • Webinars:
  • Bank Nifty Scalping
  • Intraday Trading Strategies
  • Options Trading Strategies
  • Options selling
  • Price Action
  • Relative Strength
  • Tax Planning
  • Options Buying
  • Growth Stocks
  • Portfolio Management
  • Relative Strength Index
  • Risk Management
  • Renko Charts
  • Crude Oil
  • Traders Psychology
  • Moving Average
  • Multibagger Stocks
  • Webinars:
  • Bank Nifty Scalping
  • Intraday Trading Strategies
  • Options Trading Strategies
  • Options selling
  • Price Action
  • Relative Strength
  • Tax Planning
  • Options Buying
  • Growth Stocks
  • Portfolio Management
  • Relative Strength Index
  • Risk Management
  • Renko Charts
  • Crude Oil
  • Traders Psychology
  • Moving Average
  • Multibagger Stocks
  • Free Learning Modules:
  • Intraday Trading
  • Options Scalping
  • Swing Trading
  • Financial Modelling
  • RSI Indicator
  • Bollinger Bands
  • Pricing of Futures
  • Personal Finance
  • Initial Public Offerings (IPO)
  • Value Investing
  • Technical Indicators
  • Candlesticks
  • Chart Patterns
  • Option Greeks
  • ELSS Funds
  • Banking and Insurance
  • Real Estate
  • Gold
  • Free Learning Modules:
  • Intraday Trading
  • Options Scalping
  • Swing Trading
  • Financial Modelling
  • RSI Indicator
  • Bollinger Bands
  • Pricing of Futures
  • Personal Finance
  • Initial Public Offerings (IPO)
  • Value Investing
  • Technical Indicators
  • Candlesticks
  • Chart Patterns
  • Option Greeks
  • ELSS Funds
  • Banking and Insurance
  • Real Estate
  • Gold
  • Book Summaries:
  • Rich Dad Poor Dad
  • Psychology of Money
  • The Intelligent Investor
  • The Richest Man in Babylon
  • Think and Trade Like a Champion
  • Value Investing and Behavioural Finance
  • Trading in the Zone
  • Learn to Earn
  • Book Summaries:
  • Rich Dad Poor Dad
  • Psychology of Money
  • The Intelligent Investor
  • The Richest Man in Babylon
  • Think and Trade Like a Champion
  • Value Investing and Behavioural Finance
  • Trading in the Zone
  • Learn to Earn
  • Tools:
  • CAGR Calculator
  • SIP Calculator
  • eLearnOptions
  • Future Value Calculator
  • Present Value Calculator
  • Atal Pension Yojana
  • Cost of Delay Calculator
  • Become a Crorepati
  • Tools:
  • CAGR Calculator
  • SIP Calculator
  • eLearnOptions
  • Future Value Calculator
  • Present Value Calculator
  • Atal Pension Yojana
  • Cost of Delay Calculator
  • Become a Crorepati

© 2023 Elearnmarkets. All Rights Reserved

  • Visit Elearnmarkets
  • Courses
  • Webinars
  • Financial Guides
  • Get Free Counselling
  • Visit Elearnmarkets
  • Courses
  • Webinars
  • Financial Guides
  • Get Free Counselling

Get Elearnmarkets App

No Result
View All Result
  • Article Categories
    • Basic Finance
    • Derivatives
    • Financial Planning
    • Fundamental Analysis
    • Technical Analysis
    • Marketshala
    • Miscellaneous
  • Language
    • Hindi
    • Bengali
    • English
  • Courses
  • Webinars

© 2020 Elearnmarkets All Rights Reserved