Part 4: Strategy or How the heck do I get to Financial Freedom?
4.6 Put your Financial House in Order
Without a concrete Financial Plan reaching your financial goals is just a hope. Are you saving and investing enough? Do you have all your finances in one place to take better decisions? This is an essential first step in planning.
Strategy has to be simple and common-sensical for it to be implemented well. And this is true for Investing and reaching our goals. Except guys in finance are poor marketers; they call it Financial Planning. And then they make it sound as if it will take serious expertise and forever to create one. The branding and marketing of Financial Planning is so mediocre that virtually no one does it. But it is the most important step in reaching Financial Freedom and Nirvana, so my advice to you is f…. just do it.
Most people think is very difficult to make their financial plan. The difficult parts are what we have covered in the previous chapters, knowing what you need and want. Once you have that, what you need is access to a good tool to make it happens. And literally over a cup of tea, maybe two, you can make a great first financial plan which will tell you a hell of a lot of things of how to reach your goals safely and surely. At least the one that is available on MoneyWorks4Me.com will.
The next few chapters will be really a life-changer for you if you just do it. So, I am telling you upfront, go and subscribe to whatever plan allows you access to this amazing tool that we have built. Access to the entire Financial Planning Tool and not just the free features.
Now, for some of you, having to pay any money might lead to postponing doing this essential step. This happens to many of us, we want to go safe - what if it is not worth it, maybe I can find a free tool then I will feel bad or foolish about having paid for something which is available for free. Don’t let such thoughts disrupt the confidence and faith you are building here.
While you create your Financial Plan on MoneyWorks4Me and read this chapter you will get clarity and conviction in how you are going to achieve your goals and the important decisions on how you should be investing to make it all happen. In short, your Investing...........Read More
MoneyWorks4Me method for rating and ranking mutual funds for SIP
MoneyWorks4Me rating and ranking of funds for SIP is available to subscribers only. Moneyworks4Me is not a rating and
ranking agency, however it is required that users have a way of selecting funds and building a Portfolio. The method used by it are described below to enable users to understand the logic behind the rating and ranking Subscriber will find more details on this in the
various content made available from time to time. In case you need more please write to besafe@moneyworks4Me.com
MoneyWorks4Me rates and ranks mutual funds based on the following data-driven system:
Performance Consistency: This is measure based on whether the fund has beaten the benchmark index consistently. For
this we compare the 3-year rolling returns of the fund with the benchmark for a minimum of 5 years and preferable 10
years. The period of rolling is one month and holding period is 3 years. Fund are color-coded Green on Performance when
the fund beats the benchmark more than 90% of the time. It is Orange if it beats 80% to 90% of the time and Red if less
than 80%. Funds with less than 5 year data are color-coded Grey.
Quality of Portfolio Holding: Moneyworks4Me has color-coded stocks as Green, Orange and Red based on whether the
company's performance has generated a ROCE above a threshold level (cost of capital) over 10 years (minimum 6 years) and
generated positive Free Cash Flow. For Banks it checks whether ROE is greater than 15% and sales has grown over previous
year. Stocks that perform consistently on these combined metrics are color-coded Green (min score 14 out of 20), Orange
(between 8 and 14) and Red (less than 8 out of 20).
Fund are color-coded Green provided the portfolio has 70% holding in Green stocks but not more than 20% in Red stocks.
Funds with more than 20% Red stocks in the portfolio are color-coded Red. The rest are Orange funds
Funds ranking in screeners: Performance Consistency and Quality are two parameters used for ranking funds for SIP. The
ranking as follows GG, GO, GR, OG, OO, OR, RG, RO and RR.
With the same color-coded funds, the one with the higher Average 3-year rolling returns (over 5 to 10 years), the number
that appears in the Performance tag, ranks higher.
Here is the summary:
The third tag Upside Potential is not relevant for SIP. It is relevant for lumpsum investments in Mutual Funds.
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Best Buy Stocks
Do you want to Invest in Undervalued Handpicked stocks and earn high Returns?
Why Buy Quality Stocks
Winning and long lasting portfolio is made of Quality Stocks, but how simple is that?
Important Questions while Buying Stocks
As an Investor most important decision making questions are?
Make an informed decision for Stocks
Invest using an intelligent system with powerful data-driven tools that help you identify opportunities and make informed buy-hold-sell decisions
You can make an informed decision based on:
Q : Quality :- Q Very Good
Q Somewhat Good
Q Not Good
V : Valuation:- V+UnderValued (UV) V Somewhat UV
V Fair Value
V Somewhat OV
V+ OverValued (OV)
Buy quality Stocks when they are available at reasonable prices and supported by an upward price trend and Sell when they are Overvalued using the Decizen Rating System. Covers 3500+ stocks
Make an informed decision for Funds
You can make an informed decision based on:
P : Performance (%)* 14 Very Good
14 Somewhat Good
12 Not Good
Less than 5 year data
Q : Quality of Holding Q Very Good
Q Somewhat Good
Q Not Good
*Color code for outperformance consistency
*Number is average 3 year rolling returns
Want to invest successfully in stocks?
How the heck do you select a solution that ensures it?
Does it get you focused on meeting your financial goals?
Does it get you focused on meeting your financial goals?
Investing is to means to funding your goals. Your solution must help you get clarity of your goals and how you should invest to reach them. Does your solution include Financial Planning?
Register now to get FREE 15-day access to "How the Heck to Invest and Reach Nirvana" by Raymond Moses —
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What you’ll gain:
What The Heck is Financial Freedom in my case, exactly?
How the Heck do I get to Financial Freedom?
How the Heck do I Invest in Equity?
How the Heck do I ensure I reach Financial Freedom come what may?
How the Heck to really enjoy this Journey to Financial Freedom and Nirvana?
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