How and where and which stocks to buy

Taking the idea of investing in stocks forward, the point is how, where and which stocks to buy.

All we keep hearing is the stock market is a sham, frauds keep happening, it is onlythe promoters and the brokers who earn or can make money in the markets, a common man likeme can never earn money.

I would say that yes, shams and frauds keep happening, but frauds happenevery where, in the property market, in the banks everywhere hence why single out just the stock markets.

With the spat of changes introduced in the markets the biggest and key being automated and screen based trading. We no longer have oral trading with brokers shouting of quotes, the contracts being all issued by the Stock Exchanges which include all details of thetrades done, the date, time , price and the brokerages, chances of a fraud have been reduced.

There is a lot more transparency in trading nowadays.

Coming to the point of stocks being fit only for the promoters, the rich people and brokers, I couldnt disagree any more.
Who ever said that money making is an easy task, must be joking.
I dont think one can easily make money any where. Earning always requires hard work, being diligent.
If one goes by tips, hearsay, and just blindly purchases some stocks, god only help that person I would say.
I am sure before spending any small amount one inquires in other shops, discusses with otherpeople and only then makes the purchase.
But with shares, all one does, hey, that website mentions, 400% return in a year, let me invest right away, and who cares what is the name of the company and what it manufactures.And once the investment is done, one starts tracking the company expecting profits andcomes the twist where forget the return, the principle starts eroding.
And what do we do, blame the markets, these markets are so bad, not meant for retail investors like me.
Rather than complaint later, why cant one do the research before investing in the marketsbased on the tips.A little diligence before investing will save much trouble later.
Hence dont go by hear say, read read and read before investing

Asset Allocation

I was having a casual conversation with a friend of mine..on asset allocation. Seemedshe was having a problem of plenty.

We started with the usual, take land..seemed she had one already.
I suggested build a flat/guesthouse on that..which was rejected.
Next suggestion was take a farm house, which she already had.
And so on the conversation went.

How does one allocate ones money/savings in different instruments.
And in these days there are plenty of avenues to make the investments. More so now withthe globalisation/world is flat syndrome, you have global options to invest.
A person sitting in India may well want to invest in a property in Dubai.
Me being a proponent of the stocks/share market, would always suggest to invest in the markets as well

The rule of thumb I have come across is 100 MINUS your age, is the %age one should allocate in equity. The logic being the younger you are more is the capacity to take risks. I am myself not sure how and why this rule has been there.. But maybe this logic/rule can be used as a guiding principle while investing.

The rest can be invested in fixed deposits, provident funds, house etc.

Asset allocation is as much important as saving is. Instead of wealth creation, a wrong asset allocation may erode your principal in the current inflation .

My personal picks for asset allocation would be :
If one has a steady stream of income, set aside a portion for investment in shares regularly. One may not invest in shares per the above rule directly. For this one needs to have confidence in the markets, after all its ones hard earned money.

Set aside some money in fixed deposits. Having some investment in risk free FD is always a good option.

Gradually plan to invest in some property as well. There is no denying in current times, it is a must to have some property.