10 Factors to read for the Fundamental Investing

10 Factors to read for the Fundamental Investing

It takes patience in the long run to make money on Stock Market investing. At the same time, many of us lament that we had lost about 70-80 percent on investments due to holding a particular stocks for a longer period. This is about the wrong selection of Stocks and holding the bad one for a long way.

Even if you had invested in Ten different stocks, not all the stocks will give you an immediate returns. Each stock will see it's own price cycle over a period of 5 to 10 years at different times. You do not want to be frustrated if you cannot get the right pitch, so better invest in a Good Fundamental stocks.

However if some basic factors are explored in the pantry at the stock we bought or going to buy, that is all the work for us. Although the stock price of Good Fundamental companies does not rise in the near term, but it will fetch you good wealth or returns in the long run.

Good Companies can be defined as Debt Free, Good Corporate Governance, Steady rising growth on its Revenue, Rich Cash Flow and long term prospect. Here are ten factors which can be useful to identify such companies or stocks,

• Learn about the E-I-C Framework


• Read about the Management of a Stock


• Look at the Financial Statements


• Sales and Profit Growth for the last 5 years


• Return on Equity (ROE)


• Return on Capital Employed (ROCE)


• Price to Earning & EPS Growth


• Debt & Debt to Equity


• Promoter Holding & Pledging


• Price is what you pay, Value is what you get

Valuation is always important, even if it goes wrong. Once we start looking for these ten factors in a corporate role, we can know the investment that will increase our long term wealth. It would improve our Investment thoughts too.

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