A good friend of mine has just sent me a list of the who is who of the nse millio..nay billionaires. most of them are prety obvious having been around for some time and having congested the airwaves of investment and business news for some time. i must say i love looking at that list since it gives me a jolt to action. telling me that its posible and that it feels good to be worth those billionas for doing nothing more than placing your money strategicaly and waiting. in fact when it comes to stock market patience is the key. waiting is the most difficult thing to do. most pple would love to start today and be trancentury tomorrow. in fact even though the TC guys actually began 10 years ago, by stock market standards its safe to say that they have become wealthy exremely fast. the shahs, and patels and chotabals appearing in that list have been at it for quite long and the mwangis of equity are known to have patiently sat and waited for their moments. am not saying that that wait may be over for them. they may have not reached their goals yet. however i know of a number of newly formed investment groups which have so far broken since they trotted instead of flying as was expected by the members. and when the old mutuals, baams of these world announce those crazy percentages, it doesnt really help matters.
but some teachers have found a better way to turn into millionaires in a short time. each year they pick a different text book and ask parrents to buy for the kids. so even if you have kids in each class from 1to 8 u still have to buy new books for each kid every year. no hand-me-downs. when i was in school we used safari book 1,2,3 and those were handed down from our elders. first to use them were uncles who were educated by our parents, then our elder brothers and sisters and finaly us. but not today. in these days, english changes yearly, as do mathematics, kiswahili not forgeting the geography and history of the country. maybe they are right since the last time i checked rift valley only existed in rift valley province but these days you get rift valleys in every district which does not have a govt minister.
just a wonder, how come kenyans can drive for long distances to get a peti (gas station) which is even 10 cents cheaper yet confortably consume one bottle of beer at 120 /= instead of 65 /= . ok i know dont tell me, beer is pleasure , pleasure is sweeter when expensive.
odegle tip of the day ... a rolling stone gathers no moss. its important to do a comprehensive stock analysis first before selecting a stock and once selected. it helps to hold for a good duration before selling. as the sage of omaha puts it the best holding period is forever.
I personally find there is such a thing as over-analysing of shares i.e procrastanition. At the NSE, its even better to not waste too much time on this as you'd need to add-on a multiple for emotive share-buying
ReplyDeletea broker once told me that pple lose out on shares due to holding for too long. well probably warren wouldnt agree. however given he is the best stock investor ever. you know who to blive
ReplyDeleteOdegle - WB also sells shares... but there needs to be a good reason...
ReplyDeleteHe believes in buying below intrinsic value & holding until price outstrips intrinsic value...
The more money, the harder it is to get higher returns.
Odegle: you can bet your bottom line. Mr. Buffet would agree with
ReplyDeleteyou 100%. He learned from the best of the best, from Mr. Graham "The Intelligent Investor".
Coldtusker: Good point, you are right sometimes he does sell shares, but most of the time since he likes to buy so much of an attrctive company's stocks he ends up selling the entire company if he sells-which as you guys have pointed out is farely rare.
The thing about WB that is so counter intuitive is how he lives outside of his day-to-day investment life. He is not flashy and he seems like a ready and willing techer. I can still remember my amazement while in undergraduate school, a tiny scool of perhaps 2000 students about 95% Americans of African descent, when this titan of the investment world actually came in for an hour long visit and lectured us on investments. He answered every question that was asked of him.
One thing that he said which stuck out to me and maybe it's relevant here-I don't know. He said in his opinion it is better to focus on one type of investment-that you know best and then stick to it.
Here in the States that's hard to do, most people just follow blindly whatever the investment journalists are saying.....In other cases people don't have the patience to go it over the long haul. They would do well to read your post!!!
Just buy co.s that are well mangaed in a good sector and growing.
ReplyDeleteI remember when shares on the NSE had a dividend yield of 10%-14%
Then know when to sell.
Most people know when to buy a stock but very few people know the right time to sell.
ReplyDeleteWith technological advancements and rapid changes, the world has become very competitive such that no one company dominates its market over long periods of time.
Once a company is matured and is done growing there is no need to hold onto it unless you want to preserve your wealth.
dont you just enjoy such well informed debates!
ReplyDeletehowever what i know is that there are investors and pretenders to investment. what my friend calls traders. they just buy and sell shares. the investors look for a growth industry or firm and put their future in it. those are the Warrens of this world. such pple like the muguku man who has held to equity for as long as his investment life will not let go until they are convinced that no more growth is posible.
the traders just buy when low and sell when high and they dont check whether the firm is suitably priced or not.