Wednesday, January 12, 2011

Power of Mistakes



"A child becomes an adult when he realises that he has a right not only to be right but also to be wrong " --Thomas Szasz

This is such a wonderful quote , there are so many things in life which we never try for fear of failure , for fear of being ridiculed . But the most lasting and greastest of lessons are learnt when we make a mistake .

The path to investing in Equity is ridden with lessons along the way . And these lessons can only be learn by being hands-on . No matter how much you read about investing , what you know is a tiny bit, as your lessons only start when you commit to getting your hands down and dirty in this amazing school called Equity Markets

The Market teach you many things , it teaches you patience , it teaches you not to be greedy , it teaches you that, no matter how many years you spend in the market, there is always something new to learn.

My learnings from market , in my little time in the market has been

1) You make money when you buy a stock not when you sell.
What this means is , buy at the right price and you will never be worries about your stock portfolio. Since by buying at the right price , you have made sure there is sufficient margin of safety and value .

2) Never be in a hurry to buy , since you will again get the very same price point , if you have the patience.

3) Buy a good business and hold it for as along as you can .

4) If you are itiching to invest without much study about the stock , stick to the large caps .

5) Have the discipline to hold on to your winners .

6) Keep reading . something read ages ago may help you spot a winner.

and always learn from mistakes either yours or somebody elses ..

Image : FreeDigitalPhotos.net,Photographer: Cecelia

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