Buying High P/E Stocks: Was Benjamin Graham Wrong?

The 'Price-to-Earnings' Ratio is perhaps the most commonly used Valuation tool in Stock Markets around the world. The concept was popularized by Benjamin Graham of 'The Intelligent Investor' fame. The general notion was that 'Low P/E' stocks produced better returns in the long run. But is that really the case?

Numbers and Narratives: A Simple Discounted Cash Flow (DCF) Model for Equity Valuation

I still remember the day I got into Equity Valuation. It was a drowsy Saturday afternoon and I was browsing through YouTube videos on Finance. I had been feeling quite annoyed with myself, because I was not making use of my free-time productively. You can imagine how difficult that must have been.

Masterly Inactivity: The Case for Very Long Term Passive Investments

The term 'Masterly Inactivity' was coined by Charlotte Mason in her famous book Original Homeschooling, a masterpiece on child development, parenting and education. The idea is that, parents should develop a child by 'some letting alone and some wise openings'. It's a restatement of the age-old wisdom that one should not worry about the things they can't control. I believe the idea of 'masterly inactivity' applies to investing as well.

Creating Value in an Equity Investment: The Basics

In my PGDM, the Business Strategy paper described a framework called the 'Value-Cost Framework'. That is to say, a buyer creates value for himself by paying a price which is lesser than what he is willing to pay for a product or a service. Of course, this was taught in the context of Value Creation in Marketing. But it’s not so different in the context of Common Stocks.

Purchasing Common Stock: A 7 Step Code of Conduct

This is the 7-step code-of-conduct I follow whenever I attempt to purchase a Common Stock. The code is derived from the ideas of some of the investing greats, like Warren Buffet, Charlie Munger, Philip Fisher, Peter Lynch, Monish Pabrai and Prof. Aswath Damodaran.