Investment’s Factor of Success

The philosophy in investing is creating a value for investing. What it’s mean ?

Invest in something for less than it’s actually worth, and get a gain from the difference.

It’s not easy, and sometimes can be wrong predicted.

Take a lesson from the proven succeed investor, there is some measurement can be used to determine the less valued company.

1. Profitability

Invest in company with a high and stable profitability. It’s included Sales Growth, Profit Margin, Return on Equity (ROE), Return on Investment (ROI).

2. Debt

See by what the company be financed by evaluating Debt to Equity Ratio. The higher ratio means the bigger company financed by debt. The company can be vulnerable when the interest rate is rising.

3. Business Risk

It’s important to understand the company’s businesses to calculated the risk. In some businesses, the product is changing very quickly and there is a risk if the company cannot change quickly to make some necessary adjustment. Try to avoid entering the business that we don’t understand well.

4. Company’s management team

The company is run by management team. So the quality of them is very important. Strong and good management team are rational and brave to admit to mistakes and take action to correct it. They also have “futuristic” idea not just following the competitor.

5. Product Branding

The company must have some unique content that different from it’s competitor to get competitive advantages. This can be lower cost, good brand name, unique content that protect by patent or something like that. So the company can maintain revenue’s growth in the long terms.

When making an investment, try to make long term investment, cause sometimes short term investment tends volatile and will not make money, but in the long run can profit. Try to take some time to wait and see the market, don’t panic or rush for markets rise or fall. Make sure until feel that it’s the time to buy or sell.

TRY YOUR BEST. GOOD LUCK.