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mukiha		#11 Posted : Monday, May 03, 2010 12:26:56 PM
Rank: Elder Joined: 6/27/2008 Posts: 4,114		@kenstat: Since 1954; is that young? Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
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ProverB		#12 Posted : Monday, May 03, 2010 12:29:49 PM
Rank: Veteran Joined: 3/12/2010 Posts: 1,199 Location: Eastlander		Benjamin Graham, author of Intelligent Investor, defines an investment activity as one, which upon thorough analysis promises safety of the principle invested as well as an adequate return on that investment... A basic assumption made here is that you did not become a shareholder to a company by chance but by an intelligent investment decision. If that is the case, then basic ability to understand and interpret financial reports is of paramount significance to your success as an investor in the stock market... ..Let your light so shine before men, that they may see your good works, and glorify your Father which is in heaven...Matt5:16 - 1769 Oxford King James Bible 'Authorized Version
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guru267		#13 Posted : Monday, May 03, 2010 12:31:58 PM
Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi		@kenstat i find it hard to agree with you about the income statement and cash flow statement being more important than the balance sheet when making long term investments although the cashflow and income statement are also important in decision making, they can seriously change even within a year as a result change in economic situation or events whereas the balance sheet gives a long term picture of business operations and sustainabilty... in short the cashflow and income statements are ideal for short term investors but they are exposed to too many variables for me to use them extensively to gauge a company's long term perfomance... Mark 12:29 Deuteronomy 4:16
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mukiha		#14 Posted : Monday, May 03, 2010 12:33:43 PM
Rank: Elder Joined: 6/27/2008 Posts: 4,114		guru267 wrote: mukiha wrote: SO, what values of these ratios does the NSE "consider cheap"? @mukiha we all know how inefficient the NSE operates because of the serious lack of flow of information and very narrow choice of stock so its hard to gauge what the NSE calls cheap or expensive.... What do you mean by "how inefficient the NSE operates because of the serious lack of flow of information" Aren't the listed companies required to release financial information on a strict frequency and by strict deadlines? And then the info is published by NSE immediately? Where does the "lack of flow of info" come in? Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
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mukiha		#15 Posted : Monday, May 03, 2010 12:39:46 PM
Rank: Elder Joined: 6/27/2008 Posts: 4,114		Financial statements are about the past, not the future. How does one assess the future? Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
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ProverB		#16 Posted : Monday, May 03, 2010 12:50:59 PM
Rank: Veteran Joined: 3/12/2010 Posts: 1,199 Location: Eastlander		mukiha wrote: Financial statements are about the past, not the future. How does one assess the future? no one can..you just trust the management's keeps on doing a gud job..plus benefit of momentum of company's performance into the future... ..Let your light so shine before men, that they may see your good works, and glorify your Father which is in heaven...Matt5:16 - 1769 Oxford King James Bible 'Authorized Version
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guru267		#17 Posted : Monday, May 03, 2010 12:53:40 PM
Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi		mukiha wrote: Where does the "lack of flow of info" come in? i mean lack of flow where mostly only people in Nairobi can afford to acces this information you are talking about and the more than half who have access to the information can't interpret it... hence most investing is done on an emotional basis or love for a certain company or simply rumours.... Mark 12:29 Deuteronomy 4:16
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sheep		#18 Posted : Monday, May 03, 2010 12:55:49 PM
Rank: Veteran Joined: 7/24/2008 Posts: 781		common sense carries the day as the best measure of value investing.Too much figures and studies will make u underperform,just buy sensibly and avoid paying too much and buying hype stocks.Remember to buy in fluctuations and practise margin of safety(diversification) as ben graham said.Utashangaa what type of analysis people talk of coz u will outperform them. my two cendis The utimate goal of investing is to buy low sell high;if we re-write this core equation in psychology terms it becomes buy fear sell greed.
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guru267		#19 Posted : Monday, May 03, 2010 12:59:23 PM
Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi		mukiha wrote: Financial statements are about the past, not the future. How does one assess the future? you are exactly right about financial statements reflecting the past... the only one with access to some future aspects is the balance sheet.... Accounts Payable: reflects future costs of the firm Accounts receivable: reflects future income of the firm Long term liabilities: reflects future interest and principal payments the firm has to make Just an example... Mark 12:29 Deuteronomy 4:16
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mukiha		#20 Posted : Monday, May 03, 2010 1:04:06 PM
Rank: Elder Joined: 6/27/2008 Posts: 4,114		guru267 wrote: mukiha wrote: Where does the "lack of flow of info" come in? i mean lack of flow where mostly only people in Nairobi can afford to acces this information you are talking about and the more than half who have access to the information can't interpret it... hence most investing is done on an emotional basis or love for a certain company or simply rumours.... If the information is available at NSE, then it is available at brokers' offices. It is also published in the national press [readership approx 3m]. To buy shares, one needs to go to the broker, many have the info in the waiting rooms, so the is no excuse of lack of info. Regarding inability to interpret the info; what can the NSE do to educate prospective investors? Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
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