Wise Investing

Let's understand this friends.  What exactly is top-down approach to investing? A top-down approach is also known as an EIC (Economy, Industry, Company) approach. The process flow of top-down investing goes like this. Is the macroeconomic situation strong in terms of high growth, low inflation, low interest rates, robust economic reforms, among others? Is the industry situation conducive to help the stock outperform? What is the demand situation, scope for innovation, pricing, creating brand value etc? Is the company having intrinsic strengths in terms of profits and solvency? What are the operating margins, efficiency ratios and the valuation of the stock? When does top-down work and when does bottom-up work? Normally, we find that large institutions and investors have their own unique preferences. But broadly, one can draw some demarcation lines. Top-down approach works when the basic approach to investing is focused on large cap. In any market, the large cap stocks tend to be mo...

What are the Financial Instruments Traded on the Stock Market? Investing in the stock market involves the exchange of financial instruments which is continuous and ongoing. Some people (Intraday or day traders) do not hold their financial instruments for long by buying or selling on the same day while others trade for the long term and hold financial instruments. What is a financial instrument? A financial instrument is defined as a document that indicates an asset to one individual (this person is owed) and a liability (this person owes) to another individual. All financial instruments aren’t traded in the stock market e.g. cheques. The financial instruments that are specifically traded on the stock market are shares/stocks,  derivatives bonds  and Mutual fund.   Shares/ stocks One buys a share to sell them at a profit to earn a return on your investment. Share prices fluctuate constantly which is known as volatility. It is volatility that makes profits poss...

  Reinsurance Market Research, 2031 The global reinsurance market was valued at $498.7 billion in 2021, and is projected to reach $1344.3 billion by 2031, growing at a CAGR of 10.8% from 2022 to 2031. The reinsurance market is segmented into Type, Application, Distribution Channel and Mode. Segment Review The reinsurance market is segmented into type, application, distribution channel, mode, and region. On the basis of type, the market is bifurcated into facultative reinsurance and treaty reinsurance. Treaty reinsurance is further segmented into proportional reinsurance and non -proportional reinsurance. The proportional reinsurance is further segregated into quota share and surplus share. Depending on application, it is fragmented into property & casualty reinsurance and life & health reinsurance. Life & health reinsurance is further segmented into disease insurance and medical insurance. The distribution channel segment is segregated into direct writing and re...

  Top 10 Trading Tips in the Stock Market:  Strategies for Success   The stock market may be both rewarding and difficult to trade in. Trading tips might be beneficial for you. Adopting a disciplined and informed strategy is essential to navigating the difficulties and improving your chances of success. The top 10 stock market trading ideas will be covered in this blog post, along with examples to highlight their importance.   1.  Understand the Market and Do Your Research Before diving into trading, educate yourself about the stock market and its various components. Stay updated with financial news, company reports, and market trends. Conduct thorough research on the stocks you plan to invest in. For instance, let’s say you are considering investing in Company XYZ. Analyze their financial statements, growth prospects, and competitive position in the industry before making any decisions. 2.  Set Clear Goals and Define Risk Tolerance Before you inv...

  WPI vs CPI – Key differences Real growth comes wiht these two factors for any economy WPI calculates the average price change at a wholesale level, whereas the CPI calculates the difference in the prices at a retail level. While WPI is concerned with the goods that the trading houses trade, CPI is concerned with the goods that the consumers purchase. WPI only measures goods, while the CPI measures goods and services. It measures inflation in the first stage CPI measures inflation in the final stage. WPI is the value a retailer/distributor pays. CPI is the price a consumer pays WPI articles cover fuel, energy, and manufacturing products, CPI articles cover education, transportation, communications, recreation, clothing, housing, and healthcare Only a few countries use the wholesale index, whereas more than 157 countries primarily use the consumer index.

Hello friends.   Are you also facing the same problem not to follow the process of trading, so you are not alone many people face same problem before quitting read this.    Human psychology often leads traders to deviate from their planned processes for several reasons: 1. Emotions: Emotions like fear and greed can override rational decision-making. Traders may abandon their strategy when fear of losing or the desire for quick profits takes over. 2. Overconfidence: Traders sometimes become overconfident in their abilities, leading them to take unnecessary risks or ignore their trading plan. 3. Impulsiveness: Impulsive decisions can occur due to the need for instant gratification. Traders may jump into or out of trades without proper analysis. 4. Fear of Missing Out (FOMO): Traders might enter trades hastily when they see others profiting, even if it doesn't align with their strategy. 5. Loss Aversion: People often have a greater aversion to losses than they have a de...

Hellow friends lets understand.  how Sensex is calculated  Since my early days of involvement in the stock market, I was intrigued by the number called Sensex (A BSE Index). I always wanted to know how Sensex is calculated. What is fascinating about Sensex is that, when it is rising or falling, almost all stocks Stock market I started investing in the Stock market in the year 2008. During that time, Sensex crashed more than 50%, from 20000 to 9000 points. The cause of the crash was the Subprime mortgage crisis in the US. When the index fell, even large stocks Crashed heavily.     Sensex’s rise and fall getting replicated by other stocks was a surprise for me. I wondered, what is the correlation between Sensex and individual stocks. The answer I got while researching about “how Sensex is calculated”. Before the COVID crash of 2020, Sensex was at 41,170 points (20-Feb-2020). Today (23-Aug-21) value is around 55,508 points. We keep seeing these numbers...