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EQUITY ANALYSIS
- The Toughest
Profession
The Rationale:
Pursuing
world's toughest profession of equity research, advice
and management with investors having money who think
is very easy, is a challenge by itself.
Investors having money think
equity investing very easy.
Why?
1.Many apply in new
public issue and on allotment feel great.
2.Many can buy and sell at stock market without legal
restriction.
3.Due to ease in transacting at the bourses. Just call
up stockbroker and he will transact for you or just
login online stock trading and transact yourself.
4.Many people get talks and stories of stocks from many
people, as many people talk about it even if they do
not understand intricacy of equity investment and its
character. They adopt principal of 'Common Denominator"
and follow most common advice of all people. Many small
investors approach equity as a fashion, to remain in
crowd, to remain in conversation, to feel rich, to blame
stock market for non-performance in other walks of life
if they loose in equity which invariably they do.
Why
world's toughest profession:
1.Forecasting scrip performance requires much more characteristics
and skills than just advance arithmetical ability.
2.Companies operate in ever changing dynamic market
place and get influenced by internal, external, national
and international events.
3.Scrip's performance is influenced by ameba characterised
stock markets with conflicting behavior of participants'
like-arbitrators, hedgers, momentum trader, day trader,
short/medium/long term investors, banks, institutions,
mutual funds and overseas funds.
4.Stock markets get influenced by national economic parameters
like GDP growth, inflation, bank PLR, agricultural output,
festivals, crude and administered price and government
spending.
5.Stock markets also get influenced by regulatory actions
like imposition of fresh margin, rolling settlement and
inquiry of authorities viz. SEBI, Ministry of Finance
and the governing board of Stock Exchanges.
All the above variables have to be factored into equity
analysis that makes it the world's toughest profession.
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