Throughout the years of my investment journey, I have come across a lot of people buying stocks without knowing what the company does. And majority bought it base on recommendation by friends, broker, research reports, etc.
Sometimes, they make money but over the long period of time, they lose more than they win.
Therefore, whatever stocks I pick, I will make sure I will check the company background especially the business they are operating and their financial history. Beside, considering myself an investor cum one of the shareholders for the company, I will be there for a long period unless, there’s a change in the business fundamental.
In a nutshell, I will only invest in companies with good criteria & it also applies in picking a girl to be my wife. Which, I consider it as a long time commitment & hope to minimize as much risks as possible. Dun get marry for the sake of marriage even you have reach the marriage age or sudden thought to get marry, make sure you understand her as much as possible.
Sincerely, I hope any person, who is going to put money in the stock market will try to understand what the company is doing including their past financial history & value their stocks in terms of Price multiple, Discount cash flow or Dividend discount model. All these things can either be self-learn or take up some courses in investing.