ExpertDabbler

I was doing some random reading of THE INTELLIGENT INVESTOR (The only book strongly endorsed by Warren Buffet) and i found some guidelines for the defensive investor to pick a stock. Defensive Investor can be defined as who do not want to lose their shirts, pants etc in a hurry.

#1 Exclude small companies

#2.a Current assets/Current liabilities >=2
#2.b Long term debt should not exceed net current assets

#3 Some earnings in each of the past 10 years - not sure what exactly he means here.

#4 Uninterrupted dividend payments for the last 20 years.

#5. Earnings Growth
A minimum increase of at least one third in EPS earnings in the past ten years using three-year averages at the beginning and end.

#6 Moderate Price / Earnings Ratio ubiquitously known as the PE ratio - should be 15 or less.

#7 Moderate Ratio of Price to Assets
Current market price should not be more than 1.5 times of the book value.
OR
the product of PE and CMP/Book value should always be less than or equal to 22.5.

I know there are stocks satisfying #1, #6 and #7. Not sure about #4.

I am not sure an average investor thinks about all these factors before buying a stock.
A cursory look in moneycontrol.com reveals comments like ‘This will touch Rs. 700 in 2 months’.
No wonder people lose when there is a market crash.

On the other hand, i am not sure if there is a stock in BSE/NSE which will satisfy all of these criteria.

Forget Warren buffet, i am wondering if i can make enough money to buy myself a buffet lunch through this

Apparently, people had stood in Q to book flats in one of DLF’s upcoming project in OMR. Velangumayya!!! Most of the folks have paid 5 lakhs without even looking at the location.

Now, all i can afford to book is train tickets and cinema tickets.

Why can’t I raise an IPO? It will be Expertdabbler IPO.
The prospectus filed in SEBi would say something like ‘Konjam selavu irukku, Panam kudunga’
That should be the most honest, shortest and sweetest prospectus ever in the history of SEBI.
i would not be surprised if it gets oversubscribed, for this would be the first prospectus ever to be completely read and understood by the common man.

Alternatively, I am looking for a girl whose father is a real estate developer. ‘Veetoda Maapilai’ is such a cool idea. Now, can life get any better than this? I have had enough sleepless nights as a UI developer. Let me see some real money and get settled in life. Sigh!!