S5 E5 : CHALLENGE - FIND 3 STOCKS YOU UNDERSTAND DEEPLY

🕵️ “If you can explain the business like a story, you truly understand it.”

🎯 Goal of This Challenge:

To find 3 companies you can explain like a friend’s story.
No technical terms, no expert knowledge needed — just clarity.

Because successful investing is not about fancy words, it’s about knowing what you’re buying.

💡 Why This Matters:

Most people buy stocks they don’t understand — and panic when prices fall.

But if you understand:

  1. What the company actually does

  2. How it earns money

  3. What makes it strong

Then you hold with confidence — and you’re less likely to make emotional mistakes.

📋 Step-by-Step Challenge: Find 3 Stocks You Truly Get

✅ Step 1: Pick 3 Companies You Use or See Often

Think about:

  1. Your mobile service (Jio? Airtel?)

  2. Where you buy groceries (DMart? Big Bazaar?)

  3. Clothes, shoes, electronics, gold (Titan? Bata? Croma?)

  4. Online payments (Paytm? PhonePe?)

Choose 3 companies you interact with in real life.
This builds real connection — not just numbers on a screen.

✅ Step 2: Answer These 5 Simple Questions for Each Company

Use simple language. Write it like a short story.

Example: Company — DMart (Avenue Supermarts)

  1. What do they do?
    👉 They run supermarkets where people buy groceries, household items, and daily needs.

  2. How do they make money?
    👉 They sell goods in bulk and give discounts. Because of low prices, more people come, so they sell more.

  3. Why do people choose them?
    👉 Affordable prices, neat stores, good product variety.

  4. What’s their strength?
    👉 Big customer base, smart cost control, no-frills business.

  5. Any risk or weakness?
    👉 Not much presence online. If people stop visiting physical stores, it may affect them.

✅ Step 3: Repeat This for All 3 Companies

You can use this structure:

Company Name:

What they do:

How they earn:

Why people choose them:

What’s their strength:

Any risk or weakness:

 

Choose companies like:

  1. Titan — watches, jewellery (Tanishq), eyewear

  2. Asian Paints — home wall paint and decorations

  3. HDFC Bank — loans, accounts, payments

  4. Infosys — IT services to global companies

  5. Zomato — food delivery and restaurant listing

✅ Step 4: Speak It Out Loud (Optional but Powerful)

If you can explain it to:

  1. A friend who never invested

  2. A cousin in school

  3. Even to yourself in the mirror

And they understand — that means you got it.

🎁 Bonus Tip: Stick With What You Understand

Warren Buffett’s golden advice:

“Never invest in a business you don’t understand.”

This one habit protects you from:

  1. FOMO (fear of missing out)

  2. Panic selling

  3. Random tip-based investing

🔁 Final Checklist:

  1. Picked 3 companies I use/see often

  2. Wrote answers to 5 simple questions

  3. Explained each company like a short story

  4. Understood their strengths and risks

  5. Feel confident in watching them now

✅ Congratulations. You now think like a real investor.