{"id":14335,"date":"2020-02-26T11:05:49","date_gmt":"2020-02-26T05:35:49","guid":{"rendered":"https:\/\/www.moneyworks4me.com\/investmentshastra\/?p=14335"},"modified":"2020-02-26T11:05:49","modified_gmt":"2020-02-26T05:35:49","slug":"moneyworks4me-is-built-for-decision-making-unlike-algo-based-sites","status":"publish","type":"post","link":"https:\/\/www.moneyworks4me.com\/investmentshastra\/moneyworks4me-is-built-for-decision-making-unlike-algo-based-sites\/","title":{"rendered":"MoneyWorks4me is built for decision making unlike Algo-based sites"},"content":{"rendered":"
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Moneyworks4me is built to enable serious investment decisions, unlike algo-based sites.<\/strong><\/p>\n

This article covers the following:<\/p>\n

    \n
  1. How has this made Moneyworks4me different?<\/a><\/li>\n
  2. Do rigorous valuation for the Top Companies and not use Algo-driven models for this.<\/a><\/li>\n
  3. But what about investing in mid and small-cap stocks beyond 200?<\/a><\/li>\n<\/ol>\n<\/div>\n

    MoneyWorks4me<\/strong><\/a> enables retail investors to take decisions about money that is a substantial portion of their surplus. Not the can-lose-money with which people speculate and not the let-me-dabble-and-see-how-it-goes money.<\/p>\n

    It\u2019s money that people take seriously because their financial security and ability to fulfill their responsibilities and meet personal goals depends on it.<\/p>\n

    How has this made Moneyworks4me different? <\/strong><\/h2>\n

    Enable decision making and not providing loads of data<\/strong>. What data to provide and how to represent it is driven by whether it helps investors take decisions.<\/p>\n

    So we chose to provide a set of data that is necessary and together sufficient to take a decision.<\/p>\n

    This prevents us from being tempted to show more and more data on our site (maybe we lose some organic traffic) because data overload is a big problem that hinders decision taking.<\/p>\n

    However, there are no compromises eg. we show data over 10 years to cover periods of economic growth and downturn but we colour-code it so you can interpret this very easily.<\/p>\n

    We also complement data with an Analyst note<\/a> which provides a view beyond numbers.<\/p>\n

    Decide on Fundamentals for Long term investing.<\/strong> There is a big temptation to present technical analysis and a view of the short-term performance along with the Fundamental analysis and claim its superiority.<\/p>\n

    However, this is not true and one is likely to get confusing and contradictory signals from these leading to wrong decisions.<\/p>\n

    Investments based on fundamentals rely on assessing the fair value and anchoring to that.<\/p>\n

    At MoneyWorks4me<\/a>, we look for triggers in the company\u2019s performance rather than technical which depends on stocks price movement (we have tried this and it doesn\u2019t work).<\/p>\n

    For example, if new capacities are likely to increase production, revenues and profits then we have a trigger for buying.<\/p>\n

    Do rigorous valuation for the Top Companies and not use Algo-driven models for this.\u00a0 <\/strong><\/h2>\n

    The biggest investments for retail investors happen and should happen in the best large<\/a>, top companies at a reasonable price if not at an attractive discount.<\/p>\n

    This requires getting as good an estimate of these companies as fair value as possible. There are sites that use algos (based on a statistical analysis of the stocks price history) to determine the fair value of stocks<\/a>, attractive buy and sell price<\/a>.<\/p>\n

    If this was effective, there would be no need for fundamental analysis and whiz kids and the computers would have been the wealthiest people by now.<\/p>\n

    The problem with algo-based valuations is that they throw up a wide range of outcomes. The range tends to be wider when the stock\u2019s prices in the past have been more volatile.<\/p>\n

    When we tried our hand at algorithms, we had found the valuation of companies had varied outcomes.<\/p>\n

    A company with a fair value of 100 showed a valuation range of 50-350. We have seen this happening with another website that following algo methodology (you too can find this by checking 10 to 20 stocks). Now that\u2019s too large a range to make a decision to invest.<\/p>\n

    One may expect human error rate of 10-20% around their estimated value; but since algorithm work on past volatility (without paying heed to exceptions), it throws up a very arbitrary range of outcome.<\/p>\n

    While algorithms can be used as a quick-low-effort input it does not provide a conviction to invest.<\/p>\n

    Businessmen don\u2019t use \u2018algorithm\u2019 to take expansion or acquisition decisions they analyze hard numbers themselves.<\/p>\n

    But what about investing in mid and small cap stocks beyond 200?<\/strong><\/h2>\n

    We recommend using the Mutual fund route to invest in these stocks. Algo-based valuations of stocks beyond 200 are likely to give an even wider range making it very difficult and risky to take decisions based on it.<\/p>\n\n\n\n\n\n\n\n
    <\/td>\n\n

    MoneyWorks4me<\/strong><\/p>\n<\/td>\n

    		\n

    Algo based websites<\/strong><\/p>\n<\/td>\n<\/tr>\n

    Analysis<\/td>\nFundamental; qualitative and quantitative research, involves studies of business and management.<\/td>\nBased on past volatility, set formulas don\u2019t account for a change in the economic environment, business strategy, etc.<\/td>\n<\/tr>\n
    Information<\/td>\nFiltered information for quick decisions highlights risks and key points.<\/td>\nA lot of information at disposal. Hard to pick what\u2019s relevant. Reduces productivity and adds to the confusion.<\/td>\n<\/tr>\n
    Technical Analysis with fundamental<\/td>\nFocuses on long term fundamental trends, ignores short term moves that may not be permanent in nature.<\/td>\nFocus on short term loss aversion and small profits, less critical for long term investments.<\/td>\n<\/tr>\n
    Tracking valuations<\/td>\nFair value-MRP and Discounted<\/p>\n

    Price is visible in real-time since the start of valuations eg. since 2011. Very useful to both analyst and investors<\/td>\n

    		Usually not tracked or not made visible. Even if tracked it does not aid decision making<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

    If you liked what you read and would like to put it in to practice Register at MoneyWorks4me.com<\/a>. You will get amazing FREE features that will enable you to invest in Stocks and Mutual Funds the right way.<\/p>\n

    \n

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    Moneyworks4me is built to enable serious investment decisions, unlike algo-based sites. This article covers the following: How has this made Moneyworks4me different? Do rigorous valuation for the Top Companies and not use Algo-driven models for this. But what about investing in mid and small-cap stocks beyond 200? MoneyWorks4me enables retail investors to take decisions about […]<\/p>\n","protected":false},"author":3,"featured_media":14344,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","footnotes":""},"categories":[1151,1155],"tags":[],"modified_by":"MoneyWorks4me","_links":{"self":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts\/14335"}],"collection":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/comments?post=14335"}],"version-history":[{"count":1,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts\/14335\/revisions"}],"predecessor-version":[{"id":21610,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts\/14335\/revisions\/21610"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/media\/14344"}],"wp:attachment":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/media?parent=14335"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/categories?post=14335"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/tags?post=14335"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}