How to make 100 Crore with 10 Lakh capital? Step by Step action plan explained!
a) What to buy
b) When to buy
c) How much to buy
d) When to sell
e) Discipline with risk management
f) How much time does it take
To make 100 crore from 10 lakh , we need to double our money 10 times. Is it possible? Yes! Why not? Let’s move ahead and read till the end.
a) What to buy - how to select stocks for trading? Here we need to select companies that are capable of generating more than 30% return on capital employed (ROCE) because these companies can withstand tough times like the current pandemic. These companies have a limited downside risk. We need to have 30% ROCE in last year as well as 30% average ROCE during the last 10 years period. After all these should be well proven companies.
Here is the list of 30 companies meeting 30% ROCE criteria. I have taken an exception here; I have taken a few large size financial companies into consideration because without this the list of 30 companies will not be completed.
b) When to buy - Let’s make it very simple. We should buy these companies when RSI goes below 30 levels. RSI is a technical indicator which is widely available on all charting platforms like investing.com, tradingview.com; even all the brokerage houses provide this.
c) How much to buy - let’s make it also very simple. Invest 10% of the total trading capital in one stock. So at any given point of time maximum investment would be in 10 companies. E.g. if our trading capital is 50 lakh, then invest 5 lakh in each trading opportunity; not more; not less.
d) When to sell - we should exit the trade when RSI goes above 70 levels; and invest this amount in other buying opportunities based on the above said method. This process of buying and selling will keep going on.
e) Discipline - the most important part to get success in trading and investing. We need to follow all the above discussed rules without any second thought or changes. I am repeating that all the rules need to be followed as it is without any changes. Discipline is the key to success.
f) How much time it takes - if we could make 10% gain every quarter using this strategy, which is possible, then it takes 18 and half a year to make 100 crore with 10 lakh capital. My trading experience says that this is possible, however, past performance can never guarantee the future projections.
By following all the above rules, we can secure our future and have a great life. So let’s start a new journey!