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One Up On Wall Street book

The 12 Silliest things people says about stock prices

March 11, 2021 by Laxman Sonale 1 Comment

Hello friends, in today’s article we see the 12 different silliest things people say about stock prices. Peter Lynch gives the 12 silliest things people say about the stock prices in chapter 18 of one up on wall street. So let’s see one up one

the 12 silliest things people say about stock prices
The 12 Silliest Things People says about stock prices:

  1. If it has gone down this much already, it can’t go much lower: About this thought peter lynch gives one example, one stock has the price of 30 when at buying time, and they go down and come to $13 dollar, So peter lynch things not go more than that means below $10. But that stock is going down up to $4. So thinking like the above though it doesn’t make any sense to the stock price or investment.
  2. people can always tell when a stock has hit bottom: For this thought author says, “Don’t try to catch knife, when they are falling, if you want to catch the knife, first you have to do is that knife come to the ground and they settle on the ground, then catch the knife.” So so many people just assume that they know the fall of stock prices and for that, they make the Short selling and get the maximum losses when the stock goes up. So don’t try to catch the knife, when they are falling. So you have to be patience in buying you stock that you are analyzing. (The 12 Silliest things people says about stock prices)
  3. If it has gone this high already, how can it possibly go higher than this: So many people just think like that “this stock is double and there is the growth cycle is ended and I don’t think so this stock is a little beat higher than this.” So if you are also thinking like that you can’t make the maximum money in that stock. The most probability is that you most of the time miss the multi-bagger stock. So don’t think like that, if you want to sell the stock then ask yourself, why are you buying this stock (initial main reason), or fundamental is weak.
  4. It’s only $3 a share, what can I lose?: The price of a stock in a falling situation doesn’t matter, whatever the price of the stock is $1000, $500, or $3. If they go zero dollars then that doesn’t make any sense. So don’t think like that. So you lose then you have remembered there is also the zero number that you lose, then whatever that price is go higher in multiple of that is go zero again, so zero is also chance to you lose. (The 12 Silliest things people says about stock prices)
  5. Eventually, they always come back?  Most of the time people think that whatever the price of the stock is go down then will come back. So for this author says, there is no guarantee is that this price of stock comes back. So hoping this and waiting for the stock to go up is like wasting your time (money). So Don’t think like that, and see the possibility of coming again at the right position price.
  6. It always the darkest before down: People think buying the stock and that stock is not growing, then people say this though, But it does not make any sense and staying with that stock. So there is no guarantee of the stock is go up after some time. Thinking like this stock means you have to die financially with that stock. If the stock is falling badly, and you want to come to some point of price. then you have to think like that, if you lose the 99% in that stock so there is very little means no guarantee you will recover this. So this stock is never ever recovering up to 99%, and it’s impossible to tread near that stock price. So author gives the example of Oil company stock, they buy the stock at $4560 in 1981. and this stock comes up to $2200 in 1983, so people think that the bad or darkest time is gone and actually that stock is going up to $686 in 1985 so there is no guarantee of stock is always the darkest come first or after go, it may happen the darkest stay after also. (The 12 Silliest things people says about stock prices)
  7. When it rebounds to $10, I will sell: So this is not good to sell this stock at $100 means this does not make any sense with at stock. Or you sell at any arbitrary number. there are two possibilities of this thought is 1) if this can’t happen to that at an arbitrary number, and 2) If this happens then you can test the higher return after making above the $100 because you sell the first. So there is no sense of thinking like that.
  8. Conservative stock doesn’t fluctuate much: Most people are thinking about some conservative stock, for this author gives the example of the Utility company. this company is a conservative stock company, and they go down at 80% and you ignore that stock buy saying this thought. So you have tracked the performance of the stock of conservative also with the regular time frame.
  9. It’s taking too long for anything to happen ever: Most of the time the stock price remains the same and people say, it’s taking too much a long time to happen to anything in the company. If you think like that when you sell this stock, and most of the time next day’s stock price reaches high. for this author give the example of Merk company is a pharmaceutical company, this company stock remains same continuously in 9 years. And the earning is increasingly slowly means 14% annually. So the average stock price is the same, so peter lynch says, this stock of the company is very awesome, and the probability is that this stock can become the 3X, 5X, and 10 baggers in the next few months of in a year of one or two, so stay with this type of stock, without thinking above thought. (The 12 Silliest things people says about stock prices)
  10. look at all the money, I have lost because I didn’t buy it:  This type situation come in much many time and people says, I didn’t buy that stock, I lose that much of money in that. So for this author give some explanation, he said,” So this is the human psychology,  so you have to consider in this stock, you can’t put money, so you don’t get the lose of that, and be happy with whatever you have in your hand, and ignore the other people grow, that you can make the biggest money in the stock market.
  11. I missed that one, I will catch the next one: When Linux company IPO is coming, so many people are saying that this is next Microsoft and everyone is trying to buying only on this thought, is I missed that one Microsoft, I’ll catch the next one. So all know the result of Linux. So don’t think like that, so each and every stock of the company is different so don’t blame yourself. (The 12 Silliest things people says about stock prices)
  12. The stock has gone up, so i must be right or the stock has gone down, so i must be wrong: So don’t think like that, because short term investment not telling you a clear picture of your right or wrong. in short term this only happen is that how many people ready to buy that stock or how many people are not ready for buy that stock.

This is all about the 12 silliest things people say about the stock price from chapter 18 of one up on wall street book.

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One Up On Wall Street book summary

February 26, 2021 by Laxman Sonale 6 Comments

Hello friends, In today’s article we see the summary of one up on wall street book. In this chapter, the author says, which things we have to check for our stock, so let’s begin a summary of one up on wall street book.

One Up On Wall Street book summary

Checklist: For all stocks in general(One Up On Wall Street book summary)

  • In a company, you have to check the P/E ratio, and this P/E ratio compares with the other company which has in the same industry.
  • The Company in you has seen how much is institutional ownership. if you see the institutional ownership is very less, then that is good for the company and you also.
  • In company stock, you have to see insider is buying and companies buying share back. So both point is a positive sign for investors.
  • The company, the earning of the company is increasing or not. if constantly increase or increase sometimes and decrease sometimes. (One Up On Wall Street book summary)
  • In a company, the balance sheet of the company is strong or not means debt or equity. So minimum the debt than the equity and decreases timely then that is a good sign.
  • Lastly, also see the cash position ( In previous chapter 13 author give the example of FORD company, in this company $16 is net cash is present, means ford company is never going down $16. if is going down then buy the more share.)

* So see specifically each and every category:

  1. Slow growers: 
  • In this category, you have to see the company is paying dividends or not and they pay regularly or increase slowly in a constant way or and give dividends in recession time also.
  • Company is how much percentage of earning pay in the form of a dividend. If they pay a minimum percentage of earnings in the form of dividends then this is a good sign, If they pay the maximum dividend then earning is decreases, and earnings decrease so no money to pay dividends so this is a like vice-versa to each other.
  1. Stalwarts: (One Up On Wall Street: Book summary)
  • So in this category, you have to see the company is strong or not easily go out of business.
  • For this purpose, you have to see the P/E ratio to pay maximum money for that stock. if you pay maximum money then their value is decreased.
  • Also check of company plan related to the diversification of business, if the company is making diversification, then stay away from this category of company.
  • See the long-term growth of the company is constant grow or decrease in the previous year, and what happens in recession time, their earnings decrease or not.
  1. Cyclicals:
  • In a cyclical category, you have to see in the company the supply and demand relationship of the product.
  • And also see the inventories present in the company( if the company is trying to build up, so in this category there is a new entrance, so that is more dangerous and focus on the cycle of the business.
  • In a company you have to see how much time is company cycle is staying. (One Up On Wall Street book summary)
  • So you can easily predict the upper level of the cycle of business but a lower level of the cycle we can’t predict easily. If you know that where to start the cycle of a business is good for you, because most of the people don’t know about that.
  • For example automobiles stock, this business cycle is staying 3 to 4 year and if they fall as bad as to fall and, they also increase in the very good rise of the business cycle.
  1. Fast growers:
  • in this category, you have to see, which product is selling in the maximum volume of all products of the company.
  • So you have to check how much percentage of the sale that product on other product, and how much percentage of earning of that product on the other products of the company. (One Up On Wall Street book summary)
  • So you see the companies growth rate is 20-25 is a good sign if they more than 30 means that are fake growth and they can’t stay constant and they fall in the coming year.
  • The company is spread well and they are doing the successful operation in other cities, states and country also, so you have to see this. And see the is there any space for the company to grow.
  • If they are still in one state and have space to grow in another state then it a good sign for expansion.
  • So this is not like in the previous example of the limited company, in this company, the company is growing all over all mall i.e 670 out of 700 so there is no space for the growth of the company. So if a company wants to grow then they need a new idea and new innovation in their product to expand.
  • So you have to see also the PEG ratio. This ratio is one or less than one, and stay than is a good sign.
  • You have seen the company like Gillette, they sell the lezzer which use and through type. So people use their product every time, and the company is growing continuously. and other company which has sold the electronic surveillance system. They spread all over the country and they don’t have any space for sale and this system stays 10 years of lifespan of that product, so what is the company is doing in 10 years. So the growth of the company stops. (One Up On Wall Street Book summary)
  • So lazzer selling a business is good, then the electronic surveillance system selling business.
  • Lastly, you have to see how much institutional ownership is present in the company. if as much as less and very as much as fewer analysts follow that stock.
  1. Turnaround:
  • In this category, you have to see how much debt is present in the company. as much as fewer the debt is good for that company and you have to see which type of debt is present, bank debt or funded debt.
  • The company is taking debt that is over than the equity then they affect the earning dilution. So in this debt, you can recover the company but the stock of that company is not recovering in the whole life span.
  • What is the plan of the company to recover from this situation? and they are selling the unproductive branch of the company. and they reduce the cost. and is there any plan for improvement of the company?
  1. Asset plays:
  • In this category, you have to see is there any hidden asset present in the company. or if present then what is the value of that asset.
  • You have to see how much is debt, if the debt is more than the asset, then it is the cause of concern. if they have some value than after paying debt then it is beneficial to the company. (One Up On Wall Street: Book summary)
  • If a company is taking more debt then this is not a good sign or not have a value of the hidden assets.

Previous chapter

Read More: The Intelligent Investor book

Read More: Common Stocks and Uncommon profits book

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One Up On Wall Street book: Chapter 14

February 18, 2021 by Laxman Sonale 3 Comments

Hello friends, in today’s article we see the one up on wall street book chapter 14. In this book, chapter 14 is fully discussed the company that you are chosen by giving some story to them. In this book chapter 14 of one up on wall street, we see that story is perfectly running or not by rechecking the story. (One Up On Wall Street book)


How to recheck the story:-One Up On Wall Street book

1. Read quarterly reports regularly:

  • You have to check every quarterly company story by checking quarterly reports. So what you think about the company before investing in that and now after the quarterly report is the same thing is remains same or not.
  • And also check the earning is increase or not. the company store, people are visit or not and their product sale is increasing or decreasing. And also the loyalty of product is increase or remain same. (One Up On Wall Street book)
  • For understanding, this concept author gives the example of The limited company.
  • the limited company has 670 stores in the USA, in total store in the USA is about 700. So the company is spread all over the country. so explant the business of the company is there no space for traditional strategy.
  • So if a company want to expand they need the innovative idea to expand. So in that time as an investor, you have to take the exit from this company if the company nothing to do to expand. (One Up On Wall Street book)
  • The author gives another example of a company i.e. Mcdonald’s.
  • Mcdonald’s expand itself in innovative ways, they never stop to expand and increase their profit. When Mcdonald’s spread all over the USA, then they try to found the different or innovative way to make a profit, for example, is dining, breakfast and try to spread in a foreign country. so the company takes the decad of year to spread all over the world. and they also open home delivery. So this type of innovative idea uses to increase profit and spread the company. (One Up On Wall Street book)
  • Another example is the Texas Air company.
  • Texas Air company is when the author found they are in bad condition and after that, they come to the good condition. For this type of company, you have to check the story behind this miracle situation.
  • If any company is bad in fast and now is good, is that not means that this company is not going again bad condition. So for this, you have to check the company story continuously, and always the company in tracking.
  • And don’t become the emotional fool, if the company is good and stay better.
  • So Texas Air is a company that buys the continental company and they do continental company as a turnaround. (One Up On Wall Street book)
  • So the continental company is the low-cost carrier company. So Texas Air company also acquire the Eastern company. And they try to turnaround this company also. But they don’t do, because increase the customer complaints and also the employee union problem. So author also ignores this problem, but they realize this problem.
  • then the author says, they make here two mistakes, 1) Eastern company is becoming turnaround by trying Texas Air company but they don’t realize the employee problem and also their union problem. and 2) Ignore the Delta airline company, When eastern company performance is not good then that time Delta perform a very good job, so whatever the loss of the eastern company, that benefit the Delta airline company. (One Up On Wall Street book)
  • So Delta airline is the major competitor of the eastern company. So those people travel by the Delta and eastern company, they know the problem of the company and also the which one is good or bad.
  • So that people can understand which company gives the perfect investment return.

So this is all about rechecking the story of the company. So if you find the company and make the company analysis and make investment and also you have to focus on that company. I know this is a boring job, for that warren buffet says,” Investing is simple but not easy.” So people can bethink about how much company have in our portfolio, for this Peter Lync says, ” Put that much company in your portfolio, like how many children you have in your family.”

Previous chapter

making an investment is the other part following that company is the important part. So this is all about the rechecking story of the company.

Visit the value investing website: Investing math is so simple

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One Up On Wall Street: Chapter 12

February 4, 2021 by Laxman Sonale 4 Comments

Hello friends, in today’s article, we see chapter 12 of one up on wall street book. this chapter helps you to know more about the company by asking simple questions. One up on wall street book chapter 12 helps you to find out the best questions you have to ask the company and broker.

Previous Chapter 11

 

Getting the fact: One up on wall street chapter 12

In this chapter, you get more information about the stock by asking the following questions. if you want to know more about the company ask the following point. (One Up On Wall Street)

1. If you have a full-service broker, ask them some good questions:(One Up On Wall Street) 

  • How you classify this stock as a cyclical, slow grower, fast grower. in this situation most of the time they fast, grower, because they are giving you advice about the stock.(One Up On Wall Street: Chapter 12)
  • then again ask about Recently growth in earning. What is the P/E ratio from a historical level?
  • If they tell you to buy now this time, then ask why now buying is good? And this company before buying is why not good? What happens suddenly in the company?
  • What is the company business and which business comes with maximum profit and how much spending on the growth of the company? (One Up On Wall Street)
  • How finance the company by doing issuing equity or taking maximum dept?
  • in this company any insider buying or not and give the analyst report of your analyst, I am study first and then come again ask you some good questions.
  • You have seen the price and earing report charts report of five years. And also ask the dividends of the company if the company is giving the dividends, then ask how much time pay the regular dividends and any growth in dividends in history to today. (One Up On Wall Street)
  • In the company is there any institutional ownership or not, if the answer is yes then check how much ownership is there in the company. if the institutional ownership is more then is a good sign for the company.
  • How many times your analyst follow this stock.

2. Call Investor relations: (One Up On Wall Street)

  • You can ask some questions directly to the company by using call investor relation. Then ask some question they are as follows
  • Plan of the company for debt reducing, and what is about that recently launch the drug, if they are a pharmaceutical company or that product. (One Up On Wall Street)
  • what is the effect on earnings? and how much sales of that recently launched the product in this year?
  • In this year how much company is opening a new outlet? and also how much percentage the market share increases?
  •  The company is operating at the full capacity of the plant. yes or no.
  • Properties in the balance sheet that market price value are how much?
  •  If you don’t have any above stuff question, then ask simple two questions 1) What are the positive of the company this year and 2) What is the negative of the company this year. (One Up On Wall Street)

3. Visit the company’s headquarters:(One Up On Wall Street)

  • Visiting company headquarter ask these questions, they are following
  • Any fund manager or analyst come in this headquarter. If come in two or three year then, this is a good sign for us, because this company is not followed by any fund manager or analyst.
  • If the companies headquarter is situated in like that place is not easy to like everyone to go and see.
  • The good earning and cheap headquarter is a good sign for us.(One Up On Wall Street)
  • If the company headquarter is used expensive furniture and expensive things in headquarter, then this company is not using the right place of money, so this company loses earnings in the future. So peter Lynch gives some examples is Pepboys and crown cork and shield.

4. Attend annual meetings:(One Up On Wall Street)

  • you can attend the annual meeting of the company, and talk to executives about the company.
  • Peter Lynch meets the company executive of XYZ company and ask about that company. Then after that Peter Lynch search the proxy statement of the company and they got the result is that the stock and stock option of the company is about $100 million. (One Up On Wall Street)
  • And this company’s P/E ratio is high. So if the author wants to increase his income double, then the executives of the company’s net worth also become $200 million.
  • So becoming this is unrealistic, so peter lynch never buys that stock, and sometime after the stock is going down.
  • If you think some executives do not become that rich then most of the time you are right.

5. Visit stores, buy and or taste product:

  • You can visit the store and ask some questions like that.
  • Ask questions to users of products like, Why you buy this product? and how much time is gone by using this product? and also can you recommend this product to other people. (One Up On Wall Street)
  • If one or two people give a bad review of that product, then is this no big deal.
  • So author gives the Apple company example, is that The Apple company is failing in mid-time but this time also in Peter Lynch office order the 7 to 8 macintosh computer and his wife also order macintosh, but the author doesn’t realize this stock and they lose the Apple company. (One Up On Wall Street)
  • This company can become the turnaround company, and you know the price of Apple Company in today’s day.
  • And The author also found the Crysler company that also fail for some time but this company become a turnaround by a person name is Lee Iacocca.
  • Then Peter Lynch calls Lee Iacocca and asks about the plan of the company regarding this situation and they love the plan and they think the plan also is going to execute. then they buy the Crysler company and this company becomes the turnaround. (One Up On Wall Street)

Read more on the previous chapter

Read Annual Report:

  • Screw the initial colorful pages and come to the annual report, and ask this question about the annual report to you, they are as follows
  1. Cash and marketable securities: you can see how much increase by comparing to the previous year. If increase then this is a good sign.
  2. Long-term debt: In this year and compare with previous year debt. if this debt is minimum than the previous year, if yes then good sign.
  3. (Cash + market securities) > Long term debt: If this is happening then is a good sign by comparing 10 years of the balance sheet.
  4. NOSO: If the Number Of Share Outstanding is decreased then the company does the share buyback, so this is a good sign. That is not mean is that buying buyback any time. you can check for a previous year’s buyback to share.
  5. Net cash per share= [ ( cash + market securities) – long term debt]/NOSO

By asking and seeing the above stuff you get more information about the company.

[Read more…] about One Up On Wall Street: Chapter 12

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One Up On Wall Street: Chapter 10

January 16, 2021 by Laxman Sonale 1 Comment

Hello Friends, in today’s article we see chapter 10 of One up on wall street book. In chapter 10 we see the earning process of investors. let’s see one by one.

One Up On Wall Street: Chapter 10

Earning, Earning, Earning:-One Up On Wall Street: Chapter 10

You read the before all chapter and you get the idea of investment to make money or say earn money. So to this process, you have to ask some thought to yourself in this earning process. this process as follows: (One Up On Wall Street: Chapter 10)

Read the previous chapter: Click here

 

Think to ask yourself:

  • What makes a company values and also why will it be more valuable tomorrow that is today: At this point, you have to see the company status and ask yourself the value of a company that is whatever is today, it may be changed in the future and which criteria that change in the positive way of company value. If you have a good answer in your thought they buy that company you get the absolute result of that company. (One Up On Wall Street: Chapter 10)
  • Earnings and Stock price move together: If some company stock price is more than the earning value then it is the market fluctuations. So long terms Earnings and Stock price is moving together. If earnings go higher or the stock price is low, then don’t worry the stock price follows the earnings price. that’s why Peter Lynch says Earnings and Stock price is moving together. (One Up On Wall Street: Chapter 10)
  • About the P/E Ratio: There are so many people who make the decision on the P/E ratio. So if you do also then you have to know there are three types of P/E ratio affect the stock. 1)Overprice stock: If the P/E ratio is maximum then, the stock is overpriced by the crowd of investors. 2)Underprice Stock: If the P/E ratio is minimum then, the stock is underpriced. 3)Fairlypriced: The stock price is medium than that stock is fairly-priced. That’s the common people things on the P/E ratio.
  • The author says,” To think about the P/E ratio is like how much time to take the company to recover our investment principle.” if we assume a company on P/E constant means a medium grower company then, 10 to 14 years is required to recover our money. The company is a fast grower then your money is recovered in the 7-9 years, and if the company is a slow grower, then it takes 14-20 years to recover your money. (One Up On Wall Street: Chapter 10)
  • Compare P/E ratio with industry and historical data: That you the right value of P/E which is not be followed by a crowd of investors. If you compare the P/E with historical and industry P/E then you the P/E ratio is bargain able or not. so always compare yourself with others.
  • Avoid stocks with high P/E: This type of company is followed by the big institutional investor and you have to wait in this situation time. Here our Patience quality is checked. (One Up On Wall Street: Chapter 10)

So Peter Lynch gives 5 ways that increase the earnings of the company. if the company is earning then the stock value is increased. that way as follows

5 ways to increase earnings:

  1. Reduce cost: If you want to increase earnings of your stock then, check the company expending in which area that can be reduced by any reason, if the company is doing, then your price earning is increased. So check to reduce cost.
  2. Raise Prices: If a company is increasing the price of the product, then they are directly proportional to the earnings. So check for the product price and also see the price of the limit of the product can be increased. (One Up On Wall Street: Chapter 10)
  3. Sell more product in the existing market: Check for the company sales rate, if the company is doing great sales and sell more product then it’s ok for the earnings purpose.
  4. Expand into the new market: If a company is moving and expand the whole over the country and globe then the price of earning is increasing because the company gets more sales and sells the product. So check for this purpose also. (One Up On Wall Street: Chapter 10)
  5. Close or dispose of a losing operation: Check for the unworkable machine, or the department and this company is tried and close all of his department then the price of earnings is increases.

 

This is all about the 5 ways of earning in the company, and also chapter 10 of one up on wall street book.

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One Up On Wall Street: Chapter 7

December 13, 2020 by Laxman Sonale 2 Comments

Hello friends, in this article we see chapter 7 of One Up On Wall Street book. In chapter 7 we see the I’ve got it – What is it?. The author in this chapter 7 gives some advice to remember the basic term of analysis. In this chapter how much you have to put in your effort. So let’s see step by step.

One Up On Wall Street: Chapter 7

Peter lynch advice to Remember:-One Up On Wall Street: Chapter 7

  • Investing in any company without doing research, is like playing the stud-poker game without looking at the cards. (One Up On Wall Street: Chapter 7)
  • Always remember that you have to put as much effort into picking stock, as you do into buying your groceries. (One Up On Wall Street: Chapter 7)
  • Size of the company matters: So the investment return, is all about the size of the company. if your company size is maximum then your return on investment is minimum. Because big company growth does not grow as fast as a small scale company. Always see the company industry and also the company which produces how much of profit from the industry product. If your industry is grown, and your company produces 15% of industry product. then your company is not growing as much as the industry. so the author gives two examples of a company that industry is growing but not the company. For example, Charmin cream and pampers of P & G. this company produces a cream that women can use. Another company is Hanes, this company produces legions of ladies. this company product is very famous at that time. (One Up On Wall Street: Chapter 7)

So the author separates the company into different categories to identify which company gives how much return. So let’s see step by step.

Categorization:

  1. Slow Growers: In this category, include the big company. This company’s growth is so small. So whenever the company is big, it is impossible to grow like a small company. this type of company gives regular dividends. Sometimes this company’s dividends are maximum that your investment for the long term. The Warren buffet investment strategy includes the Dividends factor. So Slow Growers grow like the GDP of the country. The is the best investment for the mutual fund manager and that individual investor who needs the safety principle. (One Up On Wall Street: Chapter 7)
  2. Stalwarts: In this category, including those companies that give the annual growth of  10-12% investment return. This type of company gives a 30-50 % profit from your investment. This profit you can make in 1-3 years of investment. So this type of company is giving the minimum return as compare to the small size company, but give the maximum return than the slow grower’s company. (One Up On Wall Street: Chapter 7)
  3. Fast Growers: In this category, include the fast-growing company. The fast-growing company is like a Small Company and New company. this company grows very fast and gives an annual 20-25% return on your investment. Sometimes it’s growing like 10 baggers, 100 baggers and also 200 baggers. If this type of company you got, you just need 1 or 2 companies that will make you rich. But as much as a return, then as much as risk include in this category. (One Up On Wall Street: Chapter 7)
  4. Cyclicals: In this category, include those company, which have seasoned business. And this business coma again and again, so the cycle of business continuously round. This business increase and also decreases. So if you want to make, money in this c0mpany. you know the business cycle and also very important is to escape before the cycle end. in this category give a double return on your investment. this company totally depends on the economy. So in this company, the loss is 80% of your investment. (One Up On Wall Street: Chapter 7)
  5. Turnarounds:  In this category, the company is coming from a loss. So this type of company gives the maximum profit. but most of the time the company can go bankrupt.
  6. Asset Plays: Asset plays, those company, which have an asset whose value is maximum than the balance sheet asset value written. In the balance sheet, the book value of assets is minimum as compared to the present time. Pebble beach company has a 25 million dollar asset, but its price is 30 million dollars. So this company is cheap. (One Up On Wall Street: Chapter 7)

Visit Biotech website: Click here

 

let’s see some advice from the author which help in the category of the company.

Remember:

  • Companies don’t stay in one category forever, for example, international Nickel.
  • There is no point in treating a Walmart, as a stalwart. So you know the time to sell.
  • Categorization is important. so that you know, when to get out of that stock.

This is all about chapter 7 of One Up On Wall Street book. If you got the above idea then you are able to know the company investment return.

Previous Chapter: Click here

 

 

Filed Under: One Up On Wall Street Tagged With: Chapter 7, Fast grower, investment, One Up On Wall Street book, peter lycnch

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