Take Investing Advice only from the people who have Skin in the Game.. Or do it yourself.

 

Imagine, you have just landed your first job. Next you want to enter the stock market. Where do you go. Most go to Twitter, YouTube, Business newspapers, Business channels, WhatsApp / Telegram groups etc. Most picks from these sources are bound to fail. Another way is to go and buy stocks of companies whose product we use. Like for example. If you own a a Maruti or Tata car. Go and buy that stock. The next is to talk to close fellow investor friends, who are also still learning. In all the above ways, the probability of making mistakes are more. Apart from this some also see IPO reviews and start investing in so called good IPOs. Chance of getting an allotment is pure luck and the same luck should be there for the IPO stock to go up too.   

In the current scenario, we know about the stock movement only after it is moved. (either up or down). As a common man, we cannot predict the moves and invest with much success.

For beginners, It is always better to start investing in ETFs, Mutual funds or Smallcases. If you are going to invest directly in the markets then please don’t go for free advices (mentioned from above sources) or IPOs. Either do your own study and make a decision or go for paid subscriptions.

If you do your own study then you have blood in the game (not skin) and slowly you will learn from mistakes which is really good in the long term (if you survive). Now we need to imbibe in our brain that quality advice might not be free. If you go for a paid advisory service the chance for skin in the game for the person who is providing the ideas is more. He will also be having a well proven system for stock selection, buy and exit strategies.  From these picks we also understand on the factors on stock selection and how different it is from the publicly available stock ideas.

I tried to pick my own multi-baggers but I could not get many and those which were more than 1 bagger soon fell, as I did not have an exit strategy. Now, I pay money to get good stock advices or strategies. There are many many people who have spent more time than me and came out with their strategies. This also helps me understand when the stalwarts are fully invested or fully in cash. This also reduces my time and anxiety on stock picking. Now a days I am relaxed on both green or red days.