A Guide To Investing

Everyone seems to have their own secret or strategy or trick to making money
in the stock market. Here are two strategies that have helped many people.

1. It's your time, how do you want to spend it?

Some people suggest high risk investments and watch them all day. Others say
that simply buying good quality mutual funds and hanging onto them for a
long time is the best option.
One of the deciding factors for you in developing your investment strategy
should be the amount of time that you are willing to spend on monitoring
your investments. There is nothing wrong with investing in high-risk
investments if you have the time to spend researching, analyzing, and
monitoring the price movement. There's also nothing wrong with the "buy and
hold" method, if you do not have the time to spend on watching your
investments.
The people who have been very successful in investing are able to match
their investment style with the amount of time they can spend on investing.

2. It's your money, how much can you risk?

The people who have lost everything on the stock market were not careful at
managing their money. The stock market is not a gamble, if you're careful.
But you need to be careful in what you buy and how much you buy.
You can decide what is right to buy based on the amount of time you want to
spend in the market. Knowing how much to buy is another issue. Don't put
more into your higher risk stocks than you're willing to lose!
You may find greater safety in buying mutual funds or bonds and if you have
money you don't want to see disappear, those are probably good options for
you. If you are sitting on your children's education fund, you probably do
not want to be sinking that in stocks that could potentially gain or lose as
much as 50% in a day!
Knowing how much time you have to spend on your portfolio and how much you
are willing to risk are two strategies that can help you make wise financial
decisions when it comes to investing.

Quote !

"Price is what you pay, Value is what you get"
                                                by Warren Buffet

Highlights of Rail Budget

Following are highlights of the Railway Budget for 2008-09 (Apr-Mar), presented by Railway Minister Shri Lalu Prasad Yadav in Lok Sabha currently


PLANNED PROJECTS
* 7-bogie mother-child health express train planned.
* Plan to man busy unmanned railway level crossings.
* Anti-fire gear to cost 7 bln rupee if pilot successful.
* Plan fire prevention device in coaches on pilot basis.
* Plan anti-collision tech in south, south-central route.
* OK for Delhi-JNPT North-West freight corridor.
* CONCOR to set up 8 depots.
* 50 big terminals planned in Mumbai, Pune, Gaziabad.
* Expansion of over 50 terminals underway.
* To consider BoT based projects.
* Mulling rail link for Ennore port.
* SPV for links to Mundra, Kandla, Krishnapatnam ports.
* Mulling raising rail network for West Bengal port.
* Completed approach road for Pipavav port.
* Auto signalling in Nagpur-Gondia stretch in progress.
* To double some lines to transport coal to power units.
* Electrification of more routes in north India underway.
* Plan automatic signalling at Gaziabad-Kanpur segment.
* To upgrade infrastructure in 7 years at 750 bln rupees.
* Expanding use of automated signalling system.
* Plan 20,000 km high density network.
* B-type stations to have professional designed shelters.
* To link trains via IT, communications by 2009.
* To start making steel coaches from 2009-10
* New Delhi, Mumbai, Patna stations to be revamped FY09.
* 2.5 trln rupee investment for network, IT upgrade 5 yr.
* TV, internet services on trains in future.
* IT vision to be implemented over next 5 years.
* To set up multi department business promotion group.
* To set up automated signalling on more routes.
* Rail Vision 2025 to set targets for next 17 years.
.
.
NEW TRAINS & SCHEMES
* To make only steel coaches from FY10.
* Have 15 licensed operators for container trains.
* Warehousing, logistics services to be given to railways.
* Private cos will be allowed to make terminals on rail land.
* To allocate land for bulk handling terminals.
* Sops for special purpose, high capacity wagons.
* Purchased 42 rakes for 5 bln rupees.
* To have new policy for bulk handling terminals.
* 25-30 tn axle load trains to be started.
* Work on 416 stations out of 560 to be completed by Sep.
* To have lifts, escalators at 50 stations.
* 30 major stations to have multi-level parking.
* 50 big stations to have lifts, escalators.
* To build foot-over-bridge on all high level platforms.
* To up auto ticket sale machines to 6000 in 2 years.
* To upgrade 203 medium level platforms to high level.
* To upgrade 281 low level platforms to medium level.
* 195 stations to get foot overbridge.
* 448 stations to be provided shelters, sheds.
* To outsource housekeeping in Shatabdi to outside cos.
* To outsource housekeeping in Rajdhanis to outside cos.
* Express trains to have public address system.
* Mail, express trains to have stainless steel coaches.
* Only stainless steel coaches to be produced after 2009-10.
* New coaches in Shatabdi trains by 2011.
* New coaches in all Rajdhani trains by 2010.
* Online arrival, departure display facility by Mar 2009.
* Rail Vision 2025 to be formulated in 6 mos.
* Wagons leasing cos to pay 50 mln rupees.
* To have new wagon leasing policy.
* In talks with foreign cos for new wagon designs.
* To make 22.9 tn stainless steel axle load wagons FY09.
* 5,000 open wagons to be changed to stainless steel.
* To up container train operators to 50-55 trains.
* 2008-09 target 20,000 wagons to be made, highest ever.
* 2007-08 wagon production seen 15,000.
* 2.5 bln rupees for acoustic bearing rail detectors.
* Acoustic, load detectors at key locations.
* Anti-collision tech to be implemented in phases.
* Anti-collision pilot has given encouraging results.
* 16,548 old rail tracks to be renewed by year-end.
* To have metal detectors, baggage scan at key stations.
* 150 bln rupee invest for stations via public-pvt route.
* To have CCTVs at all important stations.
.
.
BALANCE SHEET
* 2007-08 net revenue 184 bln rupees.
* 2007-08 cash surplus seen 250 bln rupees.
* Operating ratio in 2007-08 at 76%.
* Indian Railways employees at 1.4 mln in 2007-08.
* Railways posted 200 bln rupees cash surplus 2006-07.
* Cash surplus dividend estimate 250.65 bln rupees 2007-08.
* 233 mln tn incremental loading earned 140 bln revenue.
* Additional 20 bln rupees earnings on freight services.
* Plan size raised to 300 bln rupees in 4 years.
* Railways posted 688 bln rupees cash surplus over 4 years.
* 150 bln rupees dividend in 5 years.
* Railways fund balance up at 204.8 bln rupees.
* 2007-08 utilisation ratio 63.3%
* Passenger earning up 14% on year till December
* 2007-08 rail operating ratio estimated at 76.3%
* 790 mln tn loading likely in 2007-08.
* FY08 DRF provision 54.5 bln rupees, 70 bln FY09.
.
.
FREIGHT & FARES
* Senior women citizens concession up 50% vs 30% now.
* Free tickets for male students till 12th class.
* Girls to get free season tickets till graduation.
* Ports account for 25% of total tariff earnings
* Gauge conversion for Mangalore port completed.
* Annual steel traffic aim 200 mln tn 2011 vs 120 mln.
* 200 mln tn tariff seen from cement in 2011-12.
* Bulk terminal lessee will guarantee 0.5 mln tn tariff.
* 2007-08 freight target raised by 5 mln tn to 790 mln tn
* Freight loading up 8.2% on year till December.
* Freight loading aim 790 mln tn versus 785 mln tn 2007-08.
* Freight loading earned 347 bln rupees Apr-Dec.
* Freight loading up 8-10% in Apr-Dec.
* Hiked peak season rates on freight.
* Gave lean season discounts.
* Adopted tariff cut strategy to up market share, revenue.
* 310 mln tn excess freight loading target in next 4 yrs
.
.
EMPLOYEE BENEFIT
* Staff benefit fund to be 350 rupees/employee FY09.
* Staff benefit fund to be upped 10 times in FY09.
* FY07 day bonus up to 70 days vs 65 days.
* SC, STs got more jobs than quota FY08.
* Gangmen to be promoted to man level crossings.
* Coolies to be promoted to gangmen.
.
.
TICKETING
* Smart tickets to be extended from W Railways to others.
* Planning "smart card" based ticket system.
* Mulling ticket confirmation via mobile phone
* Plan to provide ticket booking via mobile phone.
* Rail tickets to have expected arrival time.
* E-ticket booking seen up at 300,000 vs 100,000 in 1 year.
* 15,000 computer ticket counters in 2 years vs 3,000 now.
* Aim to have no queues for tickets in 2 years
* Automated ticket vending machines at 250 now.
* Exploring options of ticketing via mobiles.
.
.
MISCELLENEOUS
* Ashok Chakra winner can travel Rajdhani, Shatabdi free.
* 200 mln tn tariff seen from steel FY12 vs 120 mln tn.
* 16,600 manned level crossings now; 18,200 unmanned.
* To fill up vacant posts in rail security forces.
* Container, rail depot development to get 20 bln rupees.
* 1 trln rupee invest eyed via public-pvt projects 5 yrs.
* Gave 5 bln rupees for pension for 6th pay commission.
* Investing surplus to boost capacity.
* Followed strategy of playing on volumes.
* India rail most profitable public transport entity.
* Have strategy to raise market share, profit.
* 139 phone enquiry services available on railways.
* 200,000-500, 000 phone enquiries in 1 year.
* Other income seen at 47 bln rupee in 4 years vs 19 bln.
* To have Green toilets in 36,000 coaches by 11th plan.
* To spend 40 bln rupees on discharge-free train toilets.

Investment Nuggets : George Soros

George Soros, founder of the Quantum Fund, is one of the most successful hedge fund investors ever. He was a master at translating economic trends into highly leveraged plays in bonds and currencies. As an investor, Soros was a short-term speculator, making huge bets on the directions of financial markets. He believed that market participants influenced one another and moved in herds. He said that most of the time he moved with the herd, but always watched for an opportunity to get out in front and "make a killing". George Soros knew well when to be cautious and when to be aggressive. His top investment tenets are:

The first priority is preservation of capital.

Be risk averse.

Develop a personal investment philosophy, an expression personality.

No two highly successful investors have the same approach.

Develop a personal system for selecting, buying, and selling investments.

Diversification is for the birds.

Do everything possible to legally minimize taxes.

Only invest in what is understandable.

Do not make investments that do not meet personal criteria. Learn to effortlessly say no.

Always search for new investment opportunities that meet personal criteria, and engage in research.

Soros's skill as an investor is simply the successful application of his philosophy. Below are a few of his nuggets:

"Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected."

"It's not whether you're right or wrong that's important, but how much money you make when you're right and how much you lose when you're wrong."

"If investing is entertaining, if you're having fun, you're probably not making any money. Good investing is boring."

"The usual bull market successfully weathers a number of tests until it is considered invulnerable, whereupon it is ripe for a bust."

"Stock market bubbles don't grow out of thin air. They have a solid basis in reality, but reality as distorted by a misconception. "

"The prevailing wisdom is that markets are always are right. I take the opposite position. I assume that markets are always wrong. Even if my assumption is occasionally wrong, I use it as a working hypothesis. This line of reasoning leads me to look for the flaw in every investment thesis. Also, when there is a discrepancy between my expectations and the actual course of events, it doesn't mean that I dump my stock. I re-examine the thesis and try to establish what has gone wrong. I may end up actually adding to my position rather than dumping it. But I certainly don't stay still and I don't ignore the discrepancy. "

Source :- http://www.thehindu businessline. com/iw/2008/ 03/02/stories/ 2008030250721501 .htm

Warren Buffets predictions for 2008

Warren Buffett became one of the wealthiest people in the world by
making predictions and putting money behind those predictions. Every
time he buys a stock or a business or some other investment, he's
forecasting the future.

Judging by the incredible returns of his holding company Berkshire
Hathaway, Buffett and his colleagues are very good at making those
predictions.

Of course, it helps when you can give your predictions plenty of time
to come true. That's one reason Buffett's favorite holding period for
investments in "outstanding businesses with outstanding managements"
is "forever." After all, "We don't get paid for activity, just for
being right. As to how long we'll wait, we'll wait indefinitely."

1. Recessions can't be avoided forever.

In the last few days, Buffett told that if unemployment picks up
significantly, the "dominoes" will fall and the U.S. economy will fall
into recession in 2008. He's not sure, however, that unemployment
will go up next year. In fact, he's surprised that all the weakness
we're seeing in housing hasn't affected the jobs market ... yet.
Here's what he is sure about: "It is the nature of capitalism to
periodically have recessions. People overshoot."

2. We'll survive future recessions just as we've survived past
problems.

As Buffett told in August, "We've got a wonderful economy... There's
never been anything like that in the history of the world. We live
seven times better than the people did a century ago on average...
We've had problems all along. If you look at the last century, we had
that Great Depression and World War Two, we had the Cold War, we had
the atomic bomb, but the country does well."

3. Recessions will create opportunities.

"I made by far the best buys I've ever made in my lifetime in 1974.
And that was a time of great pessimism and the oil shock and
stagflation and all those sort of things. But stocks were cheap."

4. All stocks won't be cheap.

Like Ted Williams waiting for the right pitch, a successful investor
waits for the right stock at the right price, and it doesn't happen
every day. "What's nice about investing is you don't have to swing at
pitches. You can watch pitches come in one inch above or one inch
below your navel, and you don't have to swing. No umpire is going to
call you out." You get in trouble, Buffett says, when you listen to
the crowd chanting "Swing, batter, swing!"

5. The crowd will make mistakes.

Buffett cites this piece of advice from his mentor Benjamin Graham:
"You're neither right nor wrong because other people agree with you.
You're right because your facts are right and your reasoning is right--
and that's the only thing that makes you right. And if your facts and
reasoning are right, you don't have to worry about anybody else."

6. Investors will mistakenly think falling stock prices are bad.

"If they reduce the price of hamburgers at McDonald's today I feel
terrific. Now I don't go back and think, gee, I paid a little more
yesterday. I think I'm going to be buying them cheaper today. Anything
you're going to be buying in the future, you want to have get cheaper.

7. Good times will prompt bad decisions.

In his 2000 Letter to Berkshire shareholders, Buffett compared the
crowd that buys big when prices are high to Cinderella at the ball.
"They know that overstaying the festivities - that is, continuing to
speculate in companies that have gigantic valuations relative to the
cash they are likely to generate in the future - will eventually bring
on pumpkins and mice. But they nevertheless hate to miss a single
minute of what is one helluva party. Therefore, the giddy participants
all plan to leave just seconds before midnight. There's a problem,
though: They are dancing in a room in which the clocks have no hands."

8. There will be more dancing at another wild party followed by
another painful hangover.

Looking back at the Internet bubble, Buffett is quoted as saying,
"The world went mad. What we learn from history is that people don't
learn from history."

Quote of the day!

"I never attempt to make money on Stock Market. I buy on the assumption that they could close the market the next day and not reopen it for five years."
- Warren Buffet