Published: 09th Aug 2024
By: Value Research
Stay in your comfort zone. Invest only in businesses where you have in-depth knowledge about the products, clientele, customers, manufacturing processes, costs involved, etc.
Every industry is unique. Make sure you know the various cycles in the industry, whether it is a highly cyclical industry, the major players and competitors, etc. Invest only when you are comfortable with the inherent risks of the industry.
If you are not well-versed in reading financial statements, it's better to hit pause now. If you know how to crunch the numbers, start off with some basic quality checks. Next, conduct a thorough financial analysis. Keep a keen eye on certain ratios such as asset turnover ratio, return on equity (ROE), return on capital employed (ROCE), etc.
There can be no price appreciation without growth. So, ensure that you are investing in a company with a clear growth roadmap. Also, check how it will fund its growth strategies. Invest only in companies aiming for profitable growth.
Investing at unjust valuations can turn a good company into a bad investment. Now, this can be tricky as there are several valuation techniques, each with its own pros and cons. Combine various techniques and adopt a holistic approach.
Value Research Stock Advisor performs all the necessary analyses, providing you with a list of promising companies to kickstart your investing journey. Subscribe now by clicking the link below.