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How to choose stocks & invest for long term

 How to choose stocks & invest for long term






First thing market is not going to anywhere. So take your time to choose sectors and companies wisely with intensely analysing every parameters.



Points which need to consider for preparing your mentality.

1. Some companies and sectors may not perform for months or years. Eg. Before pandemic Pharma sector was not perform in recent 4 years.

2. Do not care about daily fluctuations

3. Timely review your companies in which you put you hard earn money.

4. Taking exit from some wrongly selected stock is good for financial health. 

5. In panic correction increase your stakes in best Companies.


Process to selection of companies to invest.


1. Analyse the sectors which you have conviction that will grow tremendous in next 15 to 20 years. ( Do not listen to TV or Social media paid trainers and  analyst, if they know about future of market then they will not be there). To selection of sector newspaper and extra reading will helpful for you. It will take time 3 months to 1 year.

2. After selecting sectors then check market leaders, mid caps and small caps from that sectors. May be sometimes company till not listed from that sector which future's market leader. Always remember tomorrow's Multi-bagger is today's midcap/small cap company. This will take time 1 to 2 years.

3. After selecting stocks then check Balance sheets of companies. For this take help of various websites which provides free content to analysing stocks.

4. After finalizing companies which having potential to grow tremendous in future don't jump in to the stock to make position in that stock.

5. Analyse the price movement of stocks for a month minimum.

Check some technical parameters on charts eg. Moving averages or other indicators.

6. Wait for Index or particular stock price correction. Eg. If some bad news flashing on TV for that stock and you having conviction on that stock then check price movement and wait for bounce back from support level and then take entry in stock. 

7. Initial enter in stock with minimum quantity, the wait for your price to acquire stake in that stock. Sometimes after taking intital entry in stock with minimum quantity after that it will take time ( 6 months to 2 years) to acquire major stake at reasonable and cheap price.

So patience is key to survive long term.

8. After entering in stock be firm on your decision and do not sell it because of stock giving correction or it double the price.

Here I want to give real example

In year 2019 I selected one stock which traded around 160-180 price and I entered in that with small quantity. After that in March 2020 it was fall due to market crash because of pandemic. The stock going down n down 120, 75, 60 and made low around 40. After that I added quantity at price 70 then 40-45. Then average become 84. Now today that stock having price 200+. I booked some quantity initial but I remember again these rule so again added quantity now average price is 123.

9. So invest in stock is time consuming process so give proper time to that. Your investment in time and knowledge will give best returns in terms of stock returns.

Take your own decisions. For that get someone's guidance not advise. 


Things never to forget:


1. Stay away from TV analyst and paid trainers. Material to study capital markets freely available over internet.

2. Always keep in mind Stock market is not an instrument to make money overnight.

3. Do not put your all capital in stock market make investment in other instruments also.

4. Stock market is small part of life, do not make it your whole life. Do the things which you have like to do even that not given you any earnings but gives you mental peace and happiness.


Mayur Jagtap

Investment Consultant.



For regular and daily small update 

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