This is the eternal question that one has to answer more so in the case of the Unemployed like me. This is a topic started to impart tools for one to go about asking these questions.

 Every strategy succeeds or fails………..as long as it does. Warren Buffett- the investor and Rakesh JhunJhunwala- the trader cum investor. I have failed to mention here Jesse Livermore the legendary tape-reader who listened to a tip in the end from his friend and lost it all, only to commit suicide.

Let’s start with trading. There are various traders- like trend followers, trend buckers like George Soros who has made a fortune in commodities, currencies and stocks?. Wasn’t Unitech and Reliance Entertainment his last investments. Traders can use various tools- like RSI, Bollinger,etc. Some swear by them. However, the successful traders emerge bankrupt in the beginning of their strategy. Despite the tools they use, they have devised a rigorous trading plan and money-management. These successful traders have developed intuition which aids them no matter whatever metrics they use. It’s like glasses of pink, yellow or whatever colour they use to see the world, but they use intuition. No technical indicator can help than intuition. Whether it is a value stock behaving like growth stock, intuition helps in assessing the fact. The brokerage industry has an inherent advantage in proclaiming the importance of activity (As opposed to inactivity), promoting gunslinging (It happens in the Wild Wild West, but it also happens in the market). However, you have to ask yourself one important question- Are you here to play or keep count? What is your personality suited to? If you have it like RJ then you are proclaimed a trader and you will be sent to play. However, remember a player has to know the rules, the weather and all other details. Fortune will smile upon you if you are like RJ- the man whom we see one in a generation. If you think you are the one, go out and play, for you shall succeed if you have the persistence, the willingness to fail, the willingness to book a loss by instituting a stop loss and a penchant for focusing on trade, willingness to shoot in the dark (This is not to be worried upon as we feel S*x is better performed in night than day, which is the reason I gave a lot of thought and rejected BPO jobs) and hard work.

Going to investors, people have it in their heads that they need to be a crorepati to invest. This is farther from the truth. Whatever money you have, you should be in a position to deploy it properly to ensure that the investments you make give you a return in excess of  the inflation. Inflation and turnover are the enemies of any person in the stock market.

If you are a person who likes to research and likes to keep count then you shall be proclaimed an investor regardless of the money you have. It means reading a lot, investing in a few stocks (remember the quote- a little bit of this and a little bit of that and you shall have a zoo). Reduce your stocks to 3-5 companies, let time be on your side, pay attention to the fundamentals, not be a gunslinger and listen to tips. For tips are free, and lunch is free. How will the world run?. Remember the dumbest thing that anybody could do is buy a stock that is rising in a bull market?.

We shall continue to revisit the topic, with our own Basantji hopefully being able to shed light on the topic.