Learning is a lifelong process. So when you have landed on this page. Your objective should be to maximize the intake of useful information in the minimum possible number of words. There are sections on the website that are just plain information like blogs, news, exams, sports, etc. There are sections where you could learn. To make it easy for the users we will now start marking the learning sections on our website to make them more accessible. Here one must ask a very important question.

What is the difference between information & learning?

Information is something that reaches you, whereas learning is what you do with the information. Learning is the process of refining the information by acting on it with a feedback loop mechanism, where each result refines the process.

Learning anything requires us to unlearn & relearn by constantly acting on the information, and extracting new information via results & refining the process as mentioned above. We will start this journey of our learning by first understanding the world that we live in. The world is governed by two main elements Power & Money. In subsequent posts, we will expand our learning of these two words. These simple & easy to understand words are the most misunderstood.

Every word or term serves a function to its meaning.

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Why should we know about Power & Money?

Lakshmi ji & Vishnu ji photos

If we know exactly what is the true meaning & nature of power & money, it will help us in taking the decision with more rationality & accepting consequences with more reasonability. Power is the creator of Money. Money cannot create Power but its function is to aid the enforcement of power. To an extent, money gives an illusion of creating power but it is only a mirage, it can only create a collapsible structure similar to power but it cannot create absolute Power. To understand this relationship between money & power, we can take the example from Hindu Mythology where we can see the image of Lord Vishnu & Mata Lakshmi. Where Lord Vishu signifies power & Mata Lakshmi signifies abundance & prosperity.

learning about power
Learning Power Image Source – GE Power Conversion

We will understand more about power & money in a different post this is just the introduction page where we are trying to give you an introduction to the website. Investment is a very small portion of the money cycle but all of us are bound by it as if it is forever. Let us look at this aspect of money also. The inherent characteristic behind doing something with our savings is the act itself. We cannot contain our incessant urges to act because we are brought up in that manner. Therefore when we see our something idle we tend to put them to good/bad/any use that yield something in return.

Ideally, it is better to analyze the concept of money before understanding investment. Take it a step further and analyze Power before money & the entire picture falls into place. Learning all of this is necessary if we want to know & master our decisions. Before understanding investment let us try and look at human life.

Learning about the stages of life

Firstly, let us look at the different stages of human life. These stages help us in classifying our financial status & assigning a priority. Mostly, this is the case with most individuals. However, case-by-case differences can arise & there can be a significant number of exceptions within the following categories.

  1. 0-20 – Dependent
  2. 20-40 – Independent
  3. 40-60 – Responsible
  4. 60-80 – Dependent
  5. 80-100 – Dependent

The working age can be termed as the age from 16 years till 65 years maximum & peak time in terms of health, agility, enjoyment & responsibility is between 25 year & 55 years. Again this is a very broad classification, exceptions can & do exist but generally, this is the expected course of life. The graph shows the average household income in the USA.

Statistic: Median household income in the United States in 2021, by age of householder (in U.S. dollars) | Statista

As one grows old, there comes a time when a dependent individual becomes independent. The first such instance occurs at an age above 20 years & below 30 years and this can be termed as a transition age where an individual can apply for various types of jobs, and learning programs & start earning. This earning along with other sources of earnings clubbed together is known as the income of that individual.

Total Income – Total Expenditure = Savings. The savings of an individual is the most important asset not only for that individual but also for the system. Because this is the only thing that he/she will be able to safeguard, use & will be able to part away with to get his/her work done.

Income is not a solitary act. It requires time, patience, skills, learning, and practice. All of which create an ecosystem of people and productivity. Very often we think of life in terms of stages, yes life is divided into stages at an individual level. In groups or communities, individuality has no existence. A group collectively behaves as an individual. To know how we unanimously came to this point or this system where we have to interact with other people to live a good life is of utmost importance to us.

barter-system
Barter System

Learning about Savings

The concept of savings dates back to 10000 BC when humans began the practice of farming. The saving for the future was done by storing grains in pots & granaries. This also led to the development of pottery. Slowly settlements began to exchange goods within themselves & with other settlements. This system of exchange of goods was called the barter system. The barter system worked on the principle of double coincidence of wants. This restricted the scale of exchange or trade. However, trade continued in relatively small quantities based on the needs. As population increased this activity picked up pace.

To overcome this hurdle the concept of money was invented. With the invention of money came the concept of demand & supply. As a result, trades that were bigger in size can be executed & settled. It is important to know all this to expand the scope of our learning. Money derived its purchasing power from the issuer, the issuer usually a powerful person or institution. Since there were many issuers in the past like we have many currencies today. It created a unique problem of standardization of money. Gold was used to overcome this problem. More about money in our learning material on Power Structures.

ancient money
Ancient Money Image source Pinterest

For efficient utilization of savings, we can split the savings part into two major components. This financial learning is important for every individual.

  1. Investments = Acceleration
  2. Insurance = Brakes

Investments can be risky and an individual investor can choose the risk. Highly risky activity includes trading time-bound contracts or a new form of financial products such as cryptocurrencies. Trading and Investing are the activities of an investor. These activities are undertaken by an investor in financial instruments or Assets prepared by regulating agencies.

Learning about Insurance Products

It is very important to learn about insurance products. Insurance is a huge industry that works on the concept of risk pooling. Therefore it becomes important for us to learn about insurance products. There are two types of insurance.

  1. Life Insurance
  2. General Insurance
Learning the History of Insurance
Learning the History of Insurance

Objectives of this free learning content

The objective of this material is to impart free and correct knowledge to the reader. The objective is also to earn a substantial amount via google adsense. Killing two birds with a single stone. But the probability of the discovery of the content is very less. Therefore read with caution.

  • What is the structure of Financial Markets?
  • What are the different types of assets? There are a number of them and it is important for us to review these assets to our advantage.
  • Types of Financial Investment products available in the markets?
  • What are the regulating bodies in the Indian Financial Market? To have an in-depth understanding of the Indian markets it is of utmost importance to have an understanding of the regulatory framework of India
  • How can you address Financial fraud? A lot of people are afraid to even enter the securities markets as they are unaware of the redressal mechanism at their disposal.
  • Why keep all your eggs in different baskets – Risk Management? Finally when we are entering into the market then “diversity seems to be the best policy to mitigate risk
  • What are bonds? How to invest in them?
  • How do trading in Equities, Commodities, Currencies, and Cryptocurrencies, and their derivative products like futures and options?

A systematic study will help an individual in the formation of the correct perceptions and analytical skills. The publicly available data will help us in simplifying the markets. It will also improve our ability to spot discrepancies. Therefore before an individual jumps into the stock/share/financial markets, they should know the answers to some of these questions related to the markets.

Learning to Trade

Trading is both technical and tactical. One has to be careful of the risks involved. Therefore we will study the below-mentioned topics before starting to trade. Our study will help us in dealing with the markets. All this will give us a brief idea of the setup requirements for handling our investments. Finally, this exercise will also set out our expectations of the returns. The absolute returns a person generates from the markets will depend on the skills learned from this website and other online sources. Trading purely relies on candlestick patterns and indicators, partly on fundamental analysis and news.

Trading-history
Trading-history

Topics for Learning Trading

To start, trading we will first have to cover some basic terms and terminologies related to trading in general. We will also have to look into the names and functionality of institutions from the Indian context. It will create a minimum knowledge base for us, which will help us in taking trades.

  1. Technical Indicators
  2. Fundament Indicators
    • Types of Ratios
    • Analyzing balance sheets/ Account statements
  3. Types of financial instruments suited for trading

These topics are easy to understand, and practice and a beginner should not take more than three days to understand 90% of the subject material. The remaining 10% will take time to complete as it will come with real-world experience, practice, and revision.

We will try to keep the text brisk and small thereby, eliminating unnecessary portions and definitions. As a result, the reader will learn trading within three days and get meaningful results within seven days.

Investing

Investing is an art, as it is said but, that is only in the literal sense. First and foremost, it is more of mathematics than an art. Secondly, in investing, a person is not subjected to unwarranted risks but calculated risks. Finally, a person can know the risk of a business by doing the following things.

  1. A thorough reading of the balance sheet
  2. Tracking past performance
  3.  News flow
  4. Maintaining a Margin of Safety.
Warren Buffet Quote
Warren Buffet Quote

Topics to learn about Investing

To start, investing we will first have to learn some basic terms and terminologies related to trading in general. We will also have to look into the names and functionality of institutions from the Indian context as we did above. The following are the topics that we will cover to learn the art of investing.

  1. Types of asset classes
  2. Valuation – Ratios 
  3. Balance sheet analysis
  4. Commodity price analysis
  5. Setting up Correlation between different markets & sectors

We will also use some of the outside sources both for trading and investing. These will include – TradingViewIn.InvestingMoneycontrolVarsity by ZerodhaValue research.

We are very thankful to Unplash, Pexel, Pixabay for allowing us to access the free library of images. The Canva platform for providing a free tool for editing everything be it video, audio, or images. Using all these tools for free is overall an excellent learning experience.

Financial Services

To operate in the Indian securities markets, we need an account with a broker. At Lrnin we work along with the following brokers. We also offer discounts to everyone who opens their accounts using the link below. The account of Zerodha bears an account opening charge of Rs 200.

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