Thread by @VidyaG88

1/14
* HOW TO BECOME RICH THIS DIWALI 🤑 *

With Diwali around the corner along with our economy rebounding , only fair that we be bombarded with "PATAKA STOCKS" by EXPERTS from Indore to the enthusiastic newbie who made 30% returns on his portfolio ( of ₹10,000) in 1 week 🙄

2/14
So here are my 2 cents gently reminding how much of WEALTH has ACTUALLY been created for the enthusiastic retailers by PATAKA / PENNY / MULTI BAGGER stocks recommended in the past few years .

DISCLAIMER : Being a learner, I am mostly wrong 😇🙏
To each his own .

3/14
A small snapshot of a few Penny stocks ( using this word a little liberally here ) that were recommended LEFT , RIGHT AND CENTRE on Social Media & how they are doing currently :))

P.S - These are still recommended to newbies with the recount of their glorious past ! 🤦

4/14
The lure of earning huge money by purchasing PENNY stocks attracts many as they believe they are buying equity CHEAPLY.

In reality , THEY ARE ACTUALLY BUYING "CHEAP EQUITY" !

Huge difference between the two ! 🙄🤷

5/14
Risks being :
*Low market cap making it super risky
* Low liquidity making it easy for manipulation
*Skewed Risk Reward ratio
*Inconsistent performance, mostly never recovers from lows
*We get stuck in lower after lower circuits when selling begins

6/14
Look for QUALITY , NOT QUANTITY.

Penny stocks are not a treasure trove . They won't compound wealth .

Infact they are RIGHTLY called PATAKA stocks.
Afterall they are a MINEFIELD all set to blow up your capital ! 🔥💥😬🤷

7/14
If you really wish to buy during Diwali, instead of purchasing 1000 shares of 10₹ , use the entire capital to buy only 10 shares of a QUALITY company (T&C applicable)

The return ( Cap appreciation + Dividend ) would anyday be more !

*Even Index funds is good option !

8/14
Moving on to the other non penny scrips that were also recommended way too much on SM despite negatives being identified early on. (Questionable actions by management , Corporate Governance issues,cyclical ,huge debt etcetc ) becoming major wealth destroyers.

9/14
Businesses are prone to risks . Sometimes headwinds & underlying debt cause havoc even to a good business temporarily. This is where holding Quality helps.

As we all would have experienced it now , how quality falls LAST but rebounds FIRST :)

10/14
But it's an open secret that this technique of recommendation is indirectly used for Pump & Dump by operators ( especially cyclicals & bad Corporate Governance stocks)
Retail investors are the LAST to know the real happenings although we are made to think otherwise.

11/14

So this Diwali let's not
follow ANY recommendations BLINDLY from telegram ,watsapp , money control or any SM for that matter !
People are all here TO SELL .
WE are their " prospective clients " .

* MOST recommendations are sponsored.
Yeah ! 🙄UGLY TRUTH.

12/14
* Most analysts on TV don't even beat index benchmark ! So don't keep buying based on recommendations.

* If you are still looking for recommendations then you ARE NOT READY for direct equity investing.
* SIP in Index funds/good MF
* Use time wisely & self learn.

13/14

Ultimately , money not lost is also money earned which is how we shall become rich this Diwali !😇

* TO SUM IT UP *

"People are trying to be smart, all I am trying to do is not to be idiotic, but it's harder than most people think" ~ Charlie Munger.

14/14

Wishing everyone a Happy Diwali :))

*THE END*

@dmuthuk
@Vivek_Investor
@RichifyMeClub
@FI_InvestIndia
@position_trader