Stock Market Basics – Chapter 2: Finding Financials

Finding Financials:

We are heading towards the age of data. You might have heard the phrase, “Data is the new oil” and it’s not a coincidence that Mr. Muskesh Ambani came into Jio and started the Internet revolution that we experience today. It’s all for the Data.

Data, Information, knowledge. What I’m saying here is…

When it comes to Investing, only two types of people don’t get killed in the market and stick to the end, for the long term.

  1. It’s those with Insider Knowledge.
  2. It’s those with Investing Knowledge.

Insider Knowledge is for some Mahapurush who knows how to tweak the system and make it big in the stock market. That’s not what we aim to be. But, Investing Knowledge! Yeah, that’s something, if we follow well, we’ll make big in this business.

Where to get this Investing Knowledge?

There are 2 types of Information or source of information. 

  1. Quantitative: It’s the public records such as Financial Statements which include, the balance sheet, Cash flow statement, and such. 
  2. Qualitative: This is the most informative and the one that leads you to be a successful investor. Here, the information is available as any other, but it’s the investor’s way of analyzing the information that matters. Everyone has access to information, most read, some read till the end but only a few understand it and very few take action.

For Quantitative information, one can check the SEBI website, there’s no better source for information about a company than the regulatory website. You can also go to the companies website, the one you want to know about. Say, for example, Reliance Industries, Go to the RIL website and click on the “Investor Relations” page and you’ll get pretty much all the quantitative information needed. 

You can also use the help of Screener .in, this is my favorite, just add the company you wanna know about in your watchlist and get all the management updates about the company on your screener website dashboard. 

And, for Qualitative Information:

You can use “Google Finance”, here, you’ll get news articles about the company you have on your watchlist. This is a good source of Qualitative information. Read all the articles, and then sit and analyze. Get your stories straight.

To get a different perspective, read articles written by well-known bloggers and Fund house, you may find some information being biased, but, these articles will help you grow as an investor. 

Start with Motilal Oswal Wealth Creation Studies and other known Fund house providing such in-depth analysis over the market and go through the Credit rating agencies reports too.

Don’t forget to check on the newsletter. There are some pretty good Research Analysts who provide either free or paid research calls. You need not take their investment calls, but surely read the report. A great source for add-on insight. I would start with the free ones. And, for paid research material, I’m quite happy with Moneycontrol paid platform. If you have any other good ones, please let me know in the comment section.

Before concluding the topic. Remember this!

A ton of information all from all valid sources, be it Qualitative or a Quantitative one, it makes no sense unless you are an Investor in the mind.

Own the business as you own it forever, own it as if you run it forever. Now, if you were given reports of Reliance or DMart, what would you do? What would you change as an owner? If you are unable to answer this question, then it’s not your business to own.

I’m not saying you need to know every nook and corner of the business. It’s pretty easy to say a good business as it is a good business, the number speaks for itself, but, what we as an investor must do is to avoid the bad ones! 

And that’s possible only if we know what we are doing and if we know what to avoid. 

Video explaining “Stock Market Basics – Finding Financials”

https://www.youtube.com/watch?v=V_3_1H82w5I

Disclaimer: All the information on this website is published in good faith and for general information purpose only.

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