Equity as a Buisness

Introduction-

Quick comparison: Business Mindset vs. Speculator Mindset

Difference between approaches:

• Speculator Mindset: Random buying, chasing tips, hoping for luck.

• Business Mindset: Investing with capital planning, cost management, strategy, and risk control.

• Market framework: Primary vs. Secondary market (very brief) 

  • This is where companies raise money for the first time by issuing shares to the public.

  • Key activity: IPO (Initial Public Offering).

  • Investor buys shares directly from the company.

  • Purpose for company: Raise fresh capital for expansion, debt repayment

  • Analogy (Business view): Like a factory selling its products directly to customers for the first time.

  Features:

  • New securities issued.

  • Funds flow to the company.

  • SEBI regulates pricing, disclosures, and allotment.

• Types of participants (Retail, FII, DII, Brokers)

• Equity as an asset vs. FD, Gold, Real Estate

Mindset & Discipline

• Treating losses as “business expenses”

• Institutions behave like large corporations – disciplined and process-driven. Retail often behaves like gamblers.

• Avoiding emotional decisions (greed, fear, herd mentality)

• Compounding capital = reinvesting profits just like business expansion

Strategy (Business Model)

• Investor (long-term, wealth building).

• Swing Trader (short-term opportunities).

• Intraday Trader (daily margins).

• Dividend Investor (steady income).

• Arbitrage (risk-free small margins).