Day 10: Journey to wealth creation and humble life | Return simulation | x to 1000x
Okay, so I am writing the post after a week from my previous one, and here is the reason why.
So finally I have created a very basic model to invest. The idea is to keep updating the model as I learn better and keep investing to test it out as well.
Here are couple of things I check based on the model numbers.
Invested 50 Quantity each of
Cyient
Jyoti Resins
An important lessons which I have learnt in last 1 week is always believe in a model and adhere to it. While investing in Cyient, I overlooked 2 things
SSGR < Sales Growth (one reason to avoid a stock. I now see the mistake.)
I will observe the stock for next few days and if the loss is more than 8% of my investment, will sell it.
Here is the list which should pass.
Jyoti Resins passed 9/10
Cyient failed by 1/10
I should have been more observant.
1 | SSGR 3 CAGR > SG 3 CAGR |
2 | SG 3 CAGR |
3 | SG 5 CAGR |
4 | NPMgr 3 CAGR |
5 | Correlation EPS vs CMPgr |
6 | Correlation NPM vs Price |
7 | ROCE 3 CAGR > 15% |
8 | Average SSGR > Avg SG |
9 | FCF > CFO |
10 | Mgmt Promoter Holding +% |
This list will now onwards acts as the guiding light. This list will improve as we observe and figure out more strategies.