The WeekendInvesting Newsletter - 5 Feb 2024

Investing in the stock market can be a lucrative way to grow your wealth over time. However, not all stocks are created equal, and it’s crucial to identify the right opportunities for maximum returns.

This blog showcases the importance of choosing stocks that exhibit signs of momentum rather than investing in stagnant entities.

Here are a few key reasons why you should allocate your capital to such opportunities . . . .

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Which factors should you rely on for market analysis ?

As an investor, it is common to rely on financial indicators such as earnings, market share, and product performance to make investment decisions.

I recently came across an intriguing chart that shed light on the disconnect between company performance and stock performance. The chart showcased the CSI 1000 index, a Chinese index comprising small-cap stocks. It revealed a significant decline of about 66% from the index’s peak, signalling a troubling trend.

The index had surged from 6,000 to nearly 15,000 during a period when China’s economic engine was running aggressively. But, to everyone’s surprise, it later crashed to 4,000 and experienced further volatility post-COVID. This raises questions about the relationship between a company’s financial health and its stock performance. . . .

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WeekendInvesting Daily Bytes

The session was marked by volatility, with the market closing the gap created two days prior. Despite multiple attempts to sustain levels above 21,800, the market has been pushed back into a consolidation zone below this level. The market is in a mixed bag situation, showing no significant weakness but also lacking strength to maintain upward momentum.

A notable observation was the formation of . . .

Read the Lessons from Paytm case and how WI strategies performed

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