Investing Basics - Feel free to ask the most basic questions

Hi

"One can start with the traditional way of learning through books way to have good understanding about the overall structure of the markets, businesses, concepts, as books are detailed, focused works. " If possible please suggest some online resources, books , tools etc to develop understanding of different business or industries to begin with. It will be very helpful

I have given the link to the books recommendation by Dr. Hitesh. Books are the standard way of learning something, as they are detailed and dedicated works. If you are an absolute beginner, I guess reading a book will give you some idea, and you can search online later.

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Pat Dorsey has explained the discounted cashflow later in this book. Keep reading is my suggestion.

Because future brings unpredictability and inflation, and you should charge for it like bank does to cover NPA and inflation.
What if you change your company? (unpredictability)
What if your manger changes? (unpredictability)
What if you needed to attend some funeral? (inflation)
What if you need to attend your sister wedding? (inflation)

Thanks for you response I just want to ask… does this mean I’ll ask for a 5 days leave this year instead of 6 days next year? Can you please read my question again maybe I am having some trouble grasping the English

Normally yes and it depends from person to person. When dealing with your manager you should negotiate considering the future unpredictability
and importance of holiday this year(analogous to inflation).
For you, the number of holidays next year can be 5,6,7,8,9 or even 4 depending upon your calculation of unpredictability and importance of holiday this year.

I have not explained the discount rate in its true form as I think the Pat Dorsey has explained it better later in this book.

Best person to ask this question is to your dad. He can explain inflation better. When dad tells his experience, its easy to relate to inflation.

Is this right method to calculate XIRR?

Just example

1.3.18…-5000
5.9.18…-6000
21.6.19…-11500
31.12.19…-25000
4.8.20…-34000
6.12.20…-3000
10.5.21…-5600
11.11.23…-4500
17.11.23…200000

(Here 2 lakh is today’ s value of above all investment)

Is this ok??

A…In first 9 rows, i wrote investments with dates.Investments were mentioned as negative

B…I had hardly sell my stocks, so not mentioned

C…In last row, i wrote my total investment value (as of today )as positive.

And then calculate XIRR return

Kindly guide
Thanks

That is correct. You could check this too for some additional information.

And there are detailed calculating sheets available

You can check this too.

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Kindly check my edited post

Its ok for xirr calculation?

I use the site I have shared the link of, for calculating the XIRR for shorter term trades. Here is the result of your data.

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Thank u very much for your detailed explanation

I had used following for xirr caculation which gave exactly same number of 22.2%

If you have dates and amounts, excel has inbuilt function to calculate XIRR.

Yes doctor, I gave the link I use because it also shows the number of days, profit or loss, and number of cash flows, which can be useful to gain some insights regarding the investments. Also, the user interface of the site, and the ease of giving inputs can differ too.

We can use whichever we feel like using, as the return will be the same, and if we are concerned about the data we share with sites like these, we can use Excel. I use the site.

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Where can I find buyback yield of Nifty50/Sensex (preferably) or of its constitutents?
I am calculating of Equity Risk Premium using total return on constituent of Nifty50/Sensex Index. For this I need dividend yield and buyback yield; I can calculate average dividend yield from TRI version of Nifty50 but where will I get buyback yield for Nifty50/Sensex on average or its constituent stocks?

I am using the method shown by sahil sharma, where you have to download the trade book and insert 1st row as starting date account value and last row as final date account value. And insert two columns. One is binary , where sell is +1 and buy is -1 and last column value. And then apply xirr function to value column. Its easy

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These days, Zerodha is giving XIRR for each stock separately. If you click any stock in your portfolio, go to “view breakdown”. It has all the details of your purchases and sales along with XIRR.

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Thanks for this info. Can i calculate XIRR of complete portfolio using these individual stocks XIRR?

Yeah, once you have the individual stocks XIRR, you can calculate the weighted average XIRR based on the current value or holding value.

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These individual XIRR, have they considered all transactions from the start? I mean, in my case some stocks i completely exited and then purchased again after few years, so do they take into account all those transactions too?

That I am not sure of. However they do take into account of bonus shares and splits which is difficult to account for in manual calculations.

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