Category: Money tips Release Date: 2006-11-05
The world's most magical thing that is compound growth. If you come up with 15,000 yuan each year for investment, the annual return of 20%, then after 40 years of your asset is 108 million.
Then when the 20% becomes 98% then? Into the stock market 16 years, my average annual compound growth of 98%.
Do not fight uncertain war
To do every year compound growth, all my investment must not fail but to succeed - each stock should be bought to make money, and not to make money today, tomorrow they lose money. Then set the iron rule must be given its own, what money is earn and what money can not make profits.
My stock picking is an iron rule is: 1. To buy businesses to track more than three years; 2. To elect our own familiar with the industry; 3. Select the next three years, "a good balance accounts," the enterprise, do not buy the company's uncertain future profits. In short, do not fight uncertain war! So, my mind filled with a total of not more than 30 stocks. Tracking the annual increase in company stock that is 5 or less.
Let Erie do not regret it
In April 2003 to 12 months, I found the stock market, there are a number of PE in the 20-fold less than the future prospects are also very good company. At that time, the average market PE is still 40 times more, I chose the Erie shares, Maotai, Wuliangye, Yunnanbaiyao conduct research.
I then went to Hohhot, Inner Mongolia, to research Erie shares are its main competitors Mengniu (then not yet listed). Yili and Mengniu shares are good business, growth is also very good. Moreover, with the people's living standards improve, more and more people drinking milk. Yili and Mengniu, but I found that the two company's main source of profit is the liquid milk and liquid milk sales price instability, the next three years accounts are not easy to be considered clear enough, by half a month of research, finally decided to give up to buy into the Erie shares. Erie the past two years a very good stock market performance, and I do not regret it, I stand by my iron law.
Alcohol buying stocks
Why should I choose to buy Maotai, Wuliangye it? A long story, or in 1993, I had a friend who loves Baijiu each drink with a meal should be Wuliangye (I clearly remember that 52 â„?Wuliangye sold more than 140 yuan a bottle), Wuliangye listing, I have been tracking It is up to now I still have some time in the newly listed stocks bought Wuliangye, because the sales price Wuliangye relatively stable, a good balance accounts.
Guizhou Moutai when the price was 26 per 2003, earnings per share of its nearly 2 yuan, PE is a 15-fold within the next three years I have their 18% compound growth in the period up to 2006 PE should be reduced to less than 10 times. Wuliangye's financial targets were not Moutai good, but taking into account the more people drink wine Wuliangye, the two also are competitors, both there must be a able to run out. I finally decided to buy 70% of the capital of Guizhou Maotai, 30% of the funds to buy Wuliangye.
There were a lot of people advised me not to buy liquor stock, saying that fewer and fewer people will Baijiu. Yes, they say it sounds very reasonable, but I think a few thousand years, Chinese people have been Baijiu, at least not soon nobody Baijiu of. At the same time does not rule out step by step as China's prosperity, the Chinese Liquor Chinese culture will spread around the world, and their prices will gradually increase. Why is China able to sell cigarettes several times higher than the foreign cigarettes, liquor than wine sold in your country is also entirely possible.
I found that if they drink wine dinners is enough to drink bottles of drink, but a bottle of liquor may be enough, most cost-Baijiu also on the grade, in fact, high-end liquor market is still large compared with other alcohol. The shortcomings of these two companies is the business itself, have done quite large, not allow me to share the enterprises from small to big benefits. (
