Smart ways to invest and attain early financial freedom

Friends - I read a lot of blogs daily and I would like to share this story that I liked today. But before that - The easiest and surest way to build wealth is to have a mind set of investing for long periods - typically ten years and above. Out of experience I can say that it is very easy to make 20% plus ROI compounded in India, if you look at a ten year time frame. As the time frame goes down to 2-3 years, it becomes more and more difficult to make 20% ROI consistently. Also, the power of compounding kicks in over longer periods and that truly builds wealth ( as you will read in the story below). Let me give you an example - here is the HDFC Bank share price for the last ten years ( I know, you may not be investing through shares - but this is just an example).The light blue line is the HDFC Bank share price and the dark blue line is the BSE Sensex. You can click on the image to enlarge it.

Brexit was not expected – most people assumed that the British will vote to stay in the EU and hence when the results came out yesterday, there was shock and surprise. The dollar strengthened, the pound weakened and stock markets as usual over reacted and fell globally and gold rose by about 4-5%. But these are all reactions from a market that is full of traders who try to predict what will happen in short term and try to make money on a daily basis. In the long run, I believe that not much will change. Brexit does not mean that UK will stop being part of the global trade and that the British will close down their country and will become an Albania. Life will go on in the UK and over time they will untangle the mess and will live happily ever after. Having said that, one still needs to look at reasons for Brexit and see how it will impact us in the long run. Globally the gap between the rich and poor has increased in the last 50 years and with the tremendous

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Friends - In case you are in Bangalore - here is a chance to meet up this sunday -22nd Feb at 10 am in the Bangalore stock exchange.Stocks, Mutual funds (that in turn invest in stocks) and Real estate are well known ways to get good returns on investments in India. Of these, stocks needs specialised knowledge and most people do not have this knowledge. Basically most people do not know how to value stocks.This session is focussed on stock valuation. I will share valuation methods used by Warren Bufffet - and I will share this with Indian examples.So please do come over if you are interested. The session is free and you do not need to pre-book.

2014 was a wonderful year – this was the year when most investments (except gold) gave great returns – there is a good chance you have made decent returns if you were either on Direct Equity or MF or Real estate or even Debt funds. So what does 2015 look like? Looks good. Here are my recommendations for 2015 –areas where you can make 20% plus returns:   Direct Equity - Stay invested in equity and increase your exposure to equity.  I believe 2015 will be the year of equity markets in India. Globally US is doing better and EU, Japan are struggling, China is slowing down and the Emerging countries like Indonesia, South Afr

With Indian stock markets giving a 31% return, there is a sense amongst many of us of having missed the opportunity.   Plus there is this fear that if we enter too late, we will be the losers.   Also quite a few of my readers have some amount invested in stocks and they want to know if they can increase their allocation at the current levels.   And there are others who are asking whether they must exit the stock markets and take home the profits.   So the question that I want to answer is what should I do?   Let us see a few graphs before I share my point of view:   Here is the data of HDFC Bank share and the Nifty for the past 13 years so. If you were thinking of investing on say 1st Jan 2010 – you would have felt uncomfortable as it was pretty high then – but see what has happened since then. This logic is true for most years except for 2007/2008.