5 Facts about stock market you should know


I have been investing since last 15 years and learning from some of the smartest investors. Here are some facts for thought

โณ ๐™๐™๐™š ๐™ก๐™ค๐™ฃ๐™œ ๐™œ๐™–๐™ข๐™š ๐™ž๐™จ ๐™– ๐™ฌ๐™ž๐™ฃ !

“The best investment asset you can buy right now is SPX500 but banks or funds wont suggest that as its too simple and easy” these are the exact words from billionaire investor Warren Buffett, the greatest investor in history. Taking you on history class In the 20th century, the United States gone two world wars ; the Depression; number of recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet Dow rose from 66 to 11,497 !

๐Ÿ”ฅ ๐™”๐™ค๐™ช ๐™˜๐™–๐™ฃ ๐™œ๐™š๐™ฉ ๐˜ฝ๐™ช๐™ง๐™ฃ๐™š๐™™ ๐™ž๐™ฃ ๐™ฉ๐™๐™š ๐™จ๐™๐™ค๐™ง๐™ฉ-๐™ฉ๐™š๐™ง๐™ข ๐™ฅ๐™ก๐™–๐™ฎ “Road to success is never easy” this is clearly true for stock market. The chart below from JP Morgan Asset Management does a nice job explaining this. The grey bars represent each yearโ€™s return and red dots represent the intra-year drawdowns. Many times when S&P 500 had a drop of 14% or more intra-year , it jumped back and delivered positive return for 31 years out of 41 !

๐Ÿ“Š ๐™Ž๐™ฉ๐™ค๐™˜๐™ ๐™จ ๐™ฅ๐™ง๐™ค๐™ซ๐™ž๐™™๐™š๐™จ ๐™–๐™จ๐™ฎ๐™ข๐™ข๐™š๐™ฉ๐™ง๐™ž๐™˜ ๐™ช๐™ฅ๐™จ๐™ž๐™™๐™š

This is pretty basic but interesting , Stock can go down at max 100% but there is no upside limit to it ! it can deliver you many fold upside. if you remember 2009 recession. we are now 6fold upside from that low .

๐Ÿ’ธ ๐™€๐™–๐™ง๐™ฃ๐™ž๐™ฃ๐™œ๐™จ, ๐™€๐™–๐™ง๐™ฃ๐™ž๐™ฃ๐™œ๐™จ ๐™–๐™ฃ๐™™ ๐™ข๐™ค๐™ง๐™š ๐™€๐™–๐™ง๐™ฃ๐™ž๐™ฃ๐™œ๐™จ, while there are number of matrix and data you can look into to justify stock price , Any long term move in a stock can ultimately be explained by the underlying companyโ€™s earnings, expectations for earnings, and uncertainty about those expectations for earnings. 2022 is one of the year where this point will weigh in heavy .

๐Ÿ˜ฑ ๐™๐™๐™š๐™ง๐™š ๐™ฌ๐™ž๐™ก๐™ก ๐™–๐™ก๐™ฌ๐™–๐™ฎ๐™จ ๐™—๐™š ๐™จ๐™ค๐™ข๐™š๐™ฉ๐™๐™ž๐™ฃ๐™œ ๐™ฉ๐™ค ๐™ฌ๐™ค๐™ง๐™ง๐™ฎ ๐™–๐™—๐™ค๐™ช๐™ฉ ๐™›๐™ค๐™ง ๐™ฎ๐™ค๐™ช๐™ง ๐™–๐™ข๐™ฎ๐™œ๐™™๐™–๐™ก๐™–

“You can’t time the market” once again line from Warren Buffett. All news channels and social media needs viewers to make money , keeping you on the edge is their main goal ! if everything is sunshine and rainbow why would you stay hooked on to news rather then enjoying umbrella drink with your senorita ! ” Conclusion here is : get in the position when it meets your criteria do not worry about external factors or try to wait for the big drop ! Follow/Copy for more analysis or Updates. ๐Ÿ’ธ