Stock Market Training Program

Background, Learnings from History and historical facts :

• CAGR return of PPF, Gold, Silver, real estate, Stocks for last 40 years
• Annual Returns of Investment of S&P 500
• BSE Return on last 10-20-30 years
• Time line of Major events in the World
• Indian Multi Baggers in last 25 years
• India's Biggest Wealth creating companies and sectors in last 5 years
• How stock markets behaved in first half of 2020
• Stock Market Behaviour during Crisis of extreme nature historically
• An Analogy from Cricket

Tools for Stock Market Analysis

• 6 Tools for Stock Market Analysis
• Practical example from BSE Alerts
• Why focus is important
• How to Time the Markets

How to time the Markets

• Inputs from Stock price movement of Amazon, Google and Reliance
• Sir Issac Newton on Stock Markets timing
• Practical examples of understanding timing the stocks and solving in Excel
• Who can time the markets
• Learnings from Berkshire Hathway Letter to shareholders 2019

Mistake 1

• Jack Maa on Learning from Mistakes
• How many people make money in Stock Markets
• Percentage of profitable traders
• Mistake 1 elaborated with practical examples from stock markets

Mistake 2

• Mistake 2 Elaborated
• What happened on 23 April 2013
• Normal trap which investors fall prey
• What happens through Business Channels (practical example)
• Why and how stocks markets are considered Casino
• Practical examples of investors being fooled
• Insights from Bollywood

Mistake 3

• Practical example of Indian Companies
• Warren Buffett on Mistake 3
• Learning the power of compounding
• What is Special 26
• Which companies will grow
• Why we have to let our money work for us for financial independence
• Relating mistakes to Cricketing analogy
• What Oscar Figueroa teaches us about fundamental investing

Mistake 4

• Inputs from Warren Buffett
• Companies strategy on being asset light
• Personal experience of taking a housing loan
• Inferences from Berkshire Hathway Letter to shareholders 2017-2018-2020
• Amitabh Bachchan on Debt

Mistake 5

• Practical example about learning from Mistake 5
• What happens when you take a position
• What happened during Reliance AGM on 13 July 2020
• What happened during the start of Lockdown during Mar'20 end
• Issues with Derivatives Trading
• Warren Buffett Tips for Individual investors
• Summarizing all mistakes with a poem by Sh. Harivansh Rai Bachchan

How Many stocks to own in a portfolio

• Inputs from Berkshire Hathway Letter to Shareholders'1978 and 2020
• Inputs from successful stock market veterans
• Rational for quality of stocks
• Inputs from Financial Analyst Journal 1972
• TWSS Analysis of performance of mutual funds in last 5 years and reasons

Alpha and Beta

• Setting the context of Alpha and Beta
• What would be Rs 100 in 2010 for different asset classes
• Alpha Defined
• Beta Defined
• Video of Sushant Singh Rajput explaining Alpha and Beta
• Understanding Beta Levels
• Understanding Calculation of Beta in Excel
• Calculating Beta Calculation across different dates
• Comparing stock movement of high beta and low beta stocks with BSE Sensex across sectors
• What is Comfortable Beta Level
• Story of a Man with a Balancing stick

Moats (Part A)

• Analogy from Cricket
• Critical sectors understanding
• MOAT Defined
• Attributes of MOAT
• Learnings from Warren Buffett About MOATS
• Types of MOATS
• How to calculate MOAT
• Practical example of companies looking into their annual report
• Understanding Barriers to Entry

Moats (Part B)

• Discussing financials of some companies with MOATS
• Practical example of some companies with MOATS and understanding their business model
• Practical example of some companies with unbreachable MOATS
• How Economic MOATS convert into more profits
• How to identify stocks with MOAT
• Use of Morning Star Data for MOAT
• Analyzing Stock performance of MOAT Stocks
• Use of Screener

Moats (Part C)

• Understanding Return on Capital employed and Return on Equity in detail with practical example
• Understanding 2 different Business needs and requirements
• Interpretation when Return on Equity in High
• Interpretation when Return on Capital employed in high
• RoE of 6 dominant Indian firms in last 20 years
• Why and how business of some companies double every 4-5 years

Do Moats Erode?

• How the customer preferences change (Practical example)
• Practical example of some super brands fading
• Inputs from Berkshire Hathway Letter to Shareholders 2007
• Cricketing analogy featuring Saurav Ganguly, Yuvraj Singh, Rahul Dravid
• Concluding MOATS

• Taking data from Bloomberg Quint
• Companies constituting BSE Sensex when BSE started
• Common Companies giving best returns in 10 year, 5 year, 3 year horizon
• Creating your account on Screener.in
• How to create a search query
• Applying different filters basis the criteria chosen
• Attributes a company should have when filters are applied

• Understanding from Warren Buffett
• Structure of Annual Report ( Practical examples)
• Understanding Company business
• Finding out shareholding pattern including pledged shares
• Evaluation of Management
• Where to find investors complaints
• Identifying Related Party Transactions
• Management Remuneration

Introduction to Financial Statements

• Letter to shareholders by Satyam Promoters
• Practical examples of well-known companies becoming insolvent
• Practical connect of Financial statements with Cricket
• Learnings from Philip Fisher
• Introduction to Financial Statements
• Check list for Financial Health
• Introduction to Case Study for understanding Financial statements
• Learning from Warren Buffett

Understanding Revenues and Cost of Goods sold

• Format of Income Statement and some practical snapshots
• Identifying Revenue Drivers for various companies
• Elaborating Revenues and basis of it
• Decoding Warren Buffett Letter to Shareholders'2007
• Practical examples of sales, operating profit and Net Profits of multiple companies
• Understanding Great, Good and Gruesome businesses
• Basis of Increase or decrease of Revenues
• Use of Screener to identify top 10 revenue generating companies in India
• Starting to solve the case study
• Elaborating cost of goods sold and gross profit
• Interpretation if Gross profit increases/decreases over time
• Practical examples of companies whose sales fell and margins remained intact and how to decipher this
• Practical examples of companies in same industry whose margins got impacted /became better
• How to deal with cyclical businesses
• Interpretation from Warren Buffett Letter to shareholders 1987
• Completion of case study till revenues and cost of goods sold

Understanding Fixed /Intangible assets, Depreciation/Amortization

• Understanding Business Expenses
• Bifurcating revenue and capital expenses
• Capitalization of Interest cost and why it is a critical means to analyze
• Practical example of companies capitalizing interest cost
• Difference of straight line and written down value method of calculation
• How to calculate deprecation under 2 methods in Excel
• Understanding Goodwill and Intangible assets
• Learnings from Berkshire Hathway Letter to Shareholders 2019
• Decoding Great, Good and Gruesome businesses
• Understanding Various Ratios for analysis of Financial statements
• Understanding DuPont Analysis with practical examples of Indian listed companies
• Ratios for financial health check-up
• Understanding profitability, solvency and efficiency ratios
• Practical examples of ratios, reading and comprehending them
• Why a leading battery maker capex was not justifying sales and profitability
• Understanding great, good and gruesome businesses
• Inputs from Berkshire Hathway letter to Shareholders 1995

Completing Income Statement

• Completing Fixed assets Schedule and understanding Prorating the data and Debt Schedule
• Understanding Interest coverage ratio
• Preparation of Debt Schedule
• Completing Net Income and bifurcating net Income

Dividend and Retained Earnings

• Sources of Finding out stocks with good dividend yields
• How mind corruption happens wrt to Dividend paying stocks
• Filters in Screener for Dividend
• Understanding Berkshire Hathway letter to shareholders 1984
• Comprehending Berkshire Hathway Letter to shareholders 2012
• What is important? Dividend or Retained earning
• Top ten holding of President of India
• Understanding Value created per rupee of Retained Earning
• Analysis from TWSS Template for value Creation per rupee of retained earning
• Practical examples of Listed Indian companies wrt Value Creation
• Stock Price Movement of Government companies last 10 years
• Comparing RoCE, RoE and Divident Paid for companies in Multiple sectors

Understanding Balance Sheet - Liability Side

• Asset Light strategy of top 50 Corporate in India
• Inputs from Berkshire Hathway Letter to shareholders 2017
• How to identify Debt Free Companies
• Debt relative to shareholder equity
• Debt relative to earnings
• Practical interferences of Debt from company's annual report reading
• Understanding Pledged Percentage with practical example
• Why assured rentals of some leading Real estate building might not be a great idea -Practical example

Understanding Working Capital

• How credit cycle works in India
• Understanding Working capital -Definition and comprehension
• Inputs from Berkshire Hathway letter to shareholders, 2018
• Issues with Many start-ups today when focus is on sales and not profitability
• Practical examples of Infrastructure companies, Beverage companies facing heat of working capital
• How to check working capital issues in a firm looking into their financials
• Comparing Paint companies and analyzing the impact of working capital
• Comparing Auto companies and analyzing the impact of working capital

Understanding Balance Sheet - Asset Side

• Understanding Asset side items on the Balance Sheet
• What Charlie Munger says on Asset side of Balance Sheet
• Example of Intangible asset heavy Balance Sheet and its repercussions
• Practical example of Balance Sheets whose stock rose but no strength in Balance sheet and losses incurred
• Example of acquisition without rational and then bearing the brunt
• Cash diversion from Books of accounts
• Practical example of Investments becoming a prominent asset side item
• Cash diversion from Books of accounts
• Related party transaction and how the same is used to siphon off funds from the business- Practical Examples
• Why many IPOs did not give returns to shareholders -Practical Example(s)
• Inferences from Related party transactions
• Practical examples of horrible corporate Governance
• Related examples from Cricket featuring MS Dhoni and Virat Kohli
• Practical case study on how funds were siphoned off from business looking into Balance Sheet

Completing Balance Sheet

• Completing Liability side and Asset side of the case study
• Balance Sheet at a point of time

Why free Cash flows and not net cash flows

• Understanding Difference in Free Cash flows and Net Cash Flows
• Why cannot investors be fooled if analyzing free cash flows (Practical example in Excel)
• How Free Cash can help if Sales are inflated
• How Free Cash can help if operating exp is capitalized
• Why Hawk Eye is required
• Write offs by SBI

• Introductions - Valuation of a Stock
• Overview of Valuation Methods
• Case Study : Tech Mahindra using DCF Method of Valuation
• Case Study : Tech Mahindra using relative Method of Valuation
• Case Study Files

• Introduction to technical analysis
• Understanding Trends
• Understanding Market Cycle
• How to Grow a Small Trading Account
• Rules Of Trading You Cannot Break

• Identification of current trends using market structure
• Candlestick pattern - Neutral Pattern
• Candlestick pattern - Reversal pattern
• Candlestick pattern - Continuation pattern
• Chart pattern - Reversal pattern
• Chart pattern - Neutral pattern
• Chart pattern - Continuation pattern
• Strength of trend identification- Price action

• Basics of Support and Resistance
• Horizontal support & resistance
• Trading horizontal support & resistance
• Trending Support - Resistance
• Trading trend line
• Dynamic support & resistance

• Learning Stoplosses
• Understanding Risk - Reward Ratio
• Trading through price action and technical indicators
• How to be Successful Longterm Trader

This Section includes :

• Market Updates
• Current Trends
• Recent Learnings
• Trading opportunities