Money Vruksh - Articles

27 Oct 2024

Top10 from Index

(Low-Risk High-Return Strategy for Long-Term Investing)

The National Stock Exchange of India (NSE) has several key indices that track the performance of different stock market sectors and segments. The most prominent are Nifty 50, Nifty100, Nifty 500, Nifty Midcap 50, Nifty Midcap 150, Niftysmallcap50, etc. The index is called for one from the indices list.

Investors use these indices to gauge market trends and make informed investment decisions

Index investing is the most popular method for long-term investment by low-risk investors who seek reasonable returns with the lowest cost but what about investing in Index stocks that are performing better than their peers, surely you will get higher returns than the index.

To analyze the above strategy, I have compiled the data of the last 7 years for Nifty100 index stocks for their growth in Net Profit, Operating profit, and Revenue. Data is taken from the popular screener websites.

It is assumed that investment is done in the top 5 stocks based on their yearly results and the same is held for the long term till today. Just select the year of investment, returns get calculated automatically for SIP & one-time investment.

For higher returns, the exit strategy of 'when growth is below average' can be followed.

Before making any investment decision think, will it give higher returns than this?

If you want to learn more about such strategies & wish to attend training sessions, please join MoneyVruksh knowledge group for more updates. chat.whatsapp.com/IxZUVRk7Ze2K4Ae2zaID8W

O5 Oct 2024

The story which changed my life & thinking about share market.

5th Oct 2022 is the day on which I concluded my corporate career to pursue my passion in long term investing.

Today I want to share the story which changed my life.

I started investing in stock market in the year 2011. Initially I was just buying and selling the stocks based on available information but it was not giving the inner peace and was searching out for something better.

I started reading different articles and blogs to find out the investment strategy which will suit me without compromising the job responsibilities.

In 2012, I came across the article “The Great Indian Multibagger Story” published by Mr. Dev Ashish on www.stableinvestor.com which changed my thinking about share market.

I decided to invest in similar companies only for long term and let compounding do the wonders for the invested amount.

Achieving financial freedom in 10 years’ time is the result of below story published in 2012. (shared as it is)

Wouldn’t you be shocked if we told you that someone has turned Rs 10,000 into Rs 3,69,00,00,000 (Rs 369 Crores) in 32 years?. And that too by doing nothing in stock markets!! We bet you would be...

Your next question would definitely be – Who has done it?
Our answer is that we don’t know. But we are pretty sure that promoters of company would be one of them. They would have held shares for 32 years and made a killing. By the way, turning Rs 10K to Rs 369 Cr is same as growing your money 49% year on year for 32 consecutive years. Even great Warren Buffett managed a ‘paltry’ 25%... So even if we told you earlier that you cannot become Warren Buffett, here we have data, which suggests that you actually can!!
(In comparison, banks pay 8% per year on deposits)

So now you’ll ask – How has it been done?
Before we answer this question, we would caution you that data given below has been collected from various sources and may or may not be correct. So, take it with a pinch of salt.
The company is WIPRO. Suppose you invested Rs 10,000 in its shares in 1980. You would have got 100 shares @ Rs 100 each. Now shares of Wipro have gone through multiple splits & bonuses. So we adjust them as and when splits & bonuses happened.

1980 – Bought 100 shares @ Rs 100
1981 – 1:1 Bonus = 200 shares
1985 – 1:1 Bonus = 400 shares
1986 - Stock Split to Rs.10 face value = 4000 shares
1987 - 1:1 Bonus = 8000 shares
1989 - 1:1 Bonus = 16,000 shares
1992 – 1:1 Bonus = 32,000 shares
1995 – 1:1 Bonus = 64,000 shares
1997 – 2:1 Bonus = 1,92,000 shares
1999 - Stock Split to Rs. 2 face value =9,60,000 shares
2004 – 2:1 Bonus =28,80,000 shares
2005 - 1:1 Bonus =57,60,000 shares
2010 – 3:2 Bonus =96,00,000 shares
Value of one Wipro share is around Rs.385.

So as of today, your investment of Rs 10k is worth a staggering Rs.369 crores!!

And we are not finished yet. If you know about benefits of dividends, you would realize that Wipro has been a regular dividend payer. Last year it paid Rs 6 per share as dividend. So you would have earned Rs.5,76,00,000 (Rs 5.76 Crores) last year alone as dividend income. Just imagine how much you could have made from dividends alone in last 32 years.

Source :https://www.stableinvestor.com/2012/12/multibagger-of-long-term-investing.html (updated in 2021)

* This post is only for education / Information purpose *