These are the key notes of investing to understand the Business first before the stock, actually I got these notes from the book "Common Sense In Investing"
- Investing in stocks is to own all of the nation’s publicly held business (at very low cost)
- Dividends and Earning growth
- Index fund - Buy a fund that holds this all-market portfolio, hold it forever
- No risk of picking individual stocks
- Lack of short-term excitement
- Traditional Index fund (TIF) - Like a life time
- Last decade alone around $3 trillions swipes in Equity from 28 billions to 4.6 trillions
- Simply buy standard & poor’s 500 Index fund or a total stock market index fund, buy and get out and forget
- Since 2009, nations Gross Domestic Product GDP has grown at a nominal rate of 6.2%
- Annual pretax profit of nations corporation grown at rate of 6.3%
- Correlation of GDP & corporate profit growth is 1% perfect
- If you choose to play the winners game of owning shares of business
- Never try to beat the market and end up playing losers game
- There are no fund managers who repeatedly beat the markets
- For investors as a whole, returns decreases as motion increases
- No helpers with fees, your profits should include the brokerage and fees and taxes
- Don’t do something, Just stand there to avoid losers game
- Funds which we need to know,
- Growth
- Growth & Income
- Aggressive Growth
- International
