Combining the thrills of gambling
and moneymaking (and, equally often, money losing), without the social
opprobrium attached to other forms of `pure' gambling, stock trading is a
matter of great fascination for the modern man-about-town. Though this
moneymaking art is not for the down-at-heel rooky,
desperately looking for a livelihood, it delights the practitioner by a
combination of grey-cell-stimulating challenge
with an exhilarating gush of adrenalin, apart from presenting tempting and
tantalizing opportunities for making big-time money.
In popular perception, this is an art where only the maverick (and often
eccentric and reclusive) hunch-players, with a rare, almost preternatural,
gift for uncannily, serendipitously and seemingly unerringly making all
the right calls at the right time, succeed. Of course, this is not true. In point of
fact, many mere mortals do succeed in this game. But much of this art, like
any other art, is 99% perspiration and 1% inspiration.
So how do the winners go about picking the right stocks for
investment? Look at the company. Analyze its balance sheets. Look at the
profit-record over several years. Look at its
future plans and their likely impact on the company's profits and growth. Look
at the management and its competence. Look at the prospects for the
industry, market, competition, technology, etc. Pick the best company after a
threadbare analysis of its past, present and future performance in terms of
profit, sales, and growth and so on. Right? Well not quite. In fact, wrong! |
