Five strategies to maximize returns/defensive investor/enterprising investor/stock market/analysis.

                                    

                                                        Types of investor-

DEFENSIVE	ENTERPRISING
Create a Permanent portfolio	Continuously research
Not decision making	Decision making
Emotional, fear.	Risk taker, patience.
Average return	More than average return

             Five strategies to maximize returns

                     Strategy 1. Invest in index fund. For defensive investor

                     Strategy 2. Company analysis, company having

·         Minimum 500$million revenues

·         Current assets twice more than current liabilities.

·         Long term borrowing not more than net current assets.

·         Company should have positive net profit from last 10years and should have never missed dividend payout in 10 years.

·         Minimum one third increases in EPS over 10 year basis.

·         Price of the stock should not be more then 15 times of earnings and not more than 105 times of book value.

·         No. of stock 10-30

·         This strategy is also for defensive investor.

  Strategy 3. For enterprising investor

·         Current assets minimum 105 times of current liabilities.

·         Debt not more than 1.1 times of current assets.

·         No loss in 5 years

·         Regular dividend paying.

·         Some growth in earnings

·         Stock price should be less then 1.2 times of fixed assets.

·         No. of stocks minimum 20.

                   Strategy 4. More risk more reward

·         Stocks trading below their  NCAV (Net current asset value)

·         Avoid those who are not profitable in last 2years

·         Number of stocks 30

                   Strategy 5. Situation investing

·         Smaller company acquired by larger one.

·         Companies involved in legal troubles

·         Snip off

·         No. of stock 2-3

·         Strategy should be used in combination with other strategies.

                   SOURCE-THE INTELLIGENT INVESTOR   

                                     BENJAMIN GRAHAM             

*investment on market risk before investment financial advisory mandatory.