Make me some money

Made some good money…. Have a few extra bucks lying around… Why not invest them to make more money… Haven’t you heard money makes money…

So where to invest… Share market, Property, mutual funds, commodities etc.…

For the record I never made a sound investment ever in my lived life which was not pure luck or a result of herd mentality….

Now that we have established my credentials in the world of investing lets start by….. What is investing? Investing at its very basic is the usage of stored value to make more value….

For most of us the best place to invest is the stock market… A place where you can buy share in a company by investing some of your stored value (these days its called money)….The company then agrees to share its generated profits (extra value it creates on top of the initial value put in) with you based on the amount of share you own (this is known as dividend)…. So if you invest right you can get a return as high as 10-12% per annum… But wait the stock market is a little more complicated than this…. Since you own the stocks of a company that is giving such high returns…. You have leverage in your hands…. Based on the current and future earning of a company you can sell your share for a price double triple the price you originally paid for it… So for an investment of 100 for 1 share of company X and held for 5 yrs with 10% annual return and sold for 150…. Your return on investment was a whopping 100%... Sounds simple easy and safe…. No wonder everyone I know has some sort of investment in the share markets…. But somehow I don’t see everyone being a millionaire…

End lesson in the theoretical stock exchange and Begin lesson in practical stock exchange…. To get that kinda return…. One you need to know what that company X is…. Two buy the share at a reasonable price…. See what happens is that by the time normal folks like me and you hear about something like google…. The price is already too high…. It might have been a good buy at USD 200 a share but is it a good buy at USD 400… In the time you take to decide the price has gone up to USD 430… At USD 435 you buy…. It touches USD 500… is it time to sell ? or wait?

Anyways why did we buy google share… Coz everyone in the world was…. Like I stated above I have not made a sound investment which was not pure luck or result of herd mentality…..

In the current economic conditions the best investment is no investment…. Going by the Chinese 200 billion SWF (sovereign wealth fund) statement Cash is King as of now…. For the future 2-3 yrs down the line…. Commodities like oil, wheat, gold, iron etc are good investment options….

PS:- If you really want to invest … Invest in keeping good health… building character…. Forging relationships and above all invest in people around you….