Share market is a place full of risk and joy .When we invest
in the share market we do not know about the future so it is an uncertain
market and a single wrong decision can give us a huge loss. So, we must have to
analyse the information which is present in the market from various sources
such as newspaper ,internet ,magazines ,television etc.
Before investing in the share market we should analyse some
of the shares according to the economical ,political , industrial and through
the company’s information.
In the economical analyse we take the view on the following
things such as
·
Foreign exchange rate
·
Central bank’s policy
·
Rating give by various recognised credit rating
agencies
·
Taxation structure of the government for the particular industry in which we want
to invest our money
·
Debts position of the country
·
Foreign investment policies of the government
and so on.
When we go for the industrial analysis . First of all we
have to classify the industry such as mining ,services ,retail ,manufacturing
industry etc. We should also analyse the industry life cycle because the risk
varies according to the stages.whether it is in pioneering stage ,expansion
stage ,stabilisation stage or in decay
stage. As the risk is high in the
pioneering and decay stage because at that time the growth of industry is
uncertain whereas the risk is comparatively low in the expansion and
stabilisation stage.
Some important qualitative factors that define an industry
are
·
Performance
·
Labour condition
·
Competitiveness
·
Industrial policy of the government
At last we will do the company analysis and we should
analyse the following variables
·
Sales position
·
Competitive position
·
Dividend policy of the company
·
Profitability
·
Management
·
Capital structure etc.
After analysing the above factors we can invest our money
very smartly.If you want to read blogs on General Philosophy ,Tourism and sports by same author then you can visit priyankablogthoughts
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