Gold Rate: Why Basant Maheshwari is not so convinced about buying gold

In a conversation with Anil Singhvi, managing editor of Zee Business; wealth manager Basant Maheshwari of Basant Maheshwari Wealth Advisers LLP, shared investment tips for new investors.

According to Maheshwari, the most important thing is what you think about investments. If you think to make Rs 5,000 then it is fine but if you are thinking to earn Rs 5 crore from the market then you should focus on your vision. And when you start thinking big, you will stop doing small things.

Being bearish on the gold market, Maheshwari said, "gold gives dollar returns in the long term and the dollar appreciates around 3.5 per cent every year. No one becomes rich by investing in gold, people buy gold after becoming rich, he added. Add inflation and dollar appreciation price and that much you might earn in gold investments.”

When asked about the right time to invest in the market, Maheshwari explained, "90% of people use their time on finding out the market's right time. Rather, you should focus on the company. Even if you have bought that company's shares a little expensive, there is no problem because it will automatically increase in the future. The important thing is if the share is increased by 5x and then depreciating 20 per cent should not be an issue.”

You will lose your money if you try to beat the stock market with funds that you cannot afford to lose. He suggested that you bring the money to the market that you really cannot afford to lose.

Maheshwari is a well-known investor and wealth manager and is the co-founder and partner at Sebi-registered portfolio management company Basant Maheshwari Wealth Advisers LLP.

Maheshwari further said that there are two most commonly used words- multibagger and compounder. Multibagger is the share whose PE ratio increases and EPS both grow while compounders only give EPS growth. So, before investing, find out if it is a multibagger or compounder.

If you have chosen compounder then 15-17 per cent growth is very good but if you have taken multibagger, think how much its PE ratio can be increased.  

Advising on buying new stocks, he said, we should buy growth stocks as these stocks make money. If there is no growth then there is no money. If you want to keep stocks for a long, the companies' promoters should also be good.

According to him, people who think their portfolio should never go down, then their portfolio value does not increase when the market goes up.