1. Understand the concept of "paying yourself first". This is important and will go a long way for setting an investment and savings mentality.
2. As others pointed out, having an emergency fund set up and ensuring that you're taking advantage of all employer-matching and tax-saving benefits (both company and government). Different countries have different settings, so you could probably try and research those online, or ask someone you trust
3. Along with the Intelligent Investor, another book I found helpful was "A Random Walk Down Wall Street". This will help you understand ETFs and index funds
edit: If you're not in the US (or in a significantly well-developed economy), a lot of the advice in either of these books might not be as ideal as it would be otherwise. For example, in developing economies, beating of the index by reasonably knowledgable active investors is fairly common
4.
> Also, any resources for understanding index funds would be great. I know they are a basket of securities but I don't understand why they're traded on the stock market just like a stock
Index funds and Index ETFs are slightly different. Index Funds are not traded like a stock, Index ETFs are. Funds usually have a "Net Asset Value" which changes once per day. ETFs trade like a stock, and tend to fluctuate intraday.
5. Make sure you know what your investment temperament is, what your long-term goals are, and know all the mind games which you will play on yourself (not to mention the buttons the investment industry will try to push). Dan Ariely's courses and books can help a lot with understanding and minimizing irrational investment behavior.
I'm from India too. I don't deny that the books are useful; But with respect to advice on index investing, they aren't tuned as much to developing markets (speaking more about Random Walk here which heavily leans on it). Nifty50 is too lopsided by the heavyweights, even compared to tech-heavy S&P500, and most ETFs/funds here have comparatively high tracking errors and low liquidity. It's probably better to read a few country-specific books to get better context and compare.
True, the index and mutual fund part is pretty much useless. As is the calculation and market sanity
There is no equivalent of Reliance in Nasdaq or NYSE.
But if Value investing suits you, you can take up the books others have suggested and get profits
I used to be a value investor, but these days I'm not. I still look for good companies available for discount, but if it goes 10% up I immediately sell it.
Intelligent investor is good for this: you can decide what type of investor you are. That gives you an intellectual framework to work with stocks.
For eh, I bought ITC for 179 yesterday, it went down to 176 today, but I did not immediately freakout, I am holding to the stock coz it has value and company is financially strong and product wise very diverse.
I've already got some minor profit and dividend from ITC in the past.
Get the basics, follow a framework but also be aware that this is just luck in the end. You can't predict a stock market so if you think you can invest all money directly in stocks then its not a good idea
Some in stocks some in RD/FD (not option in US as interest rates are like 1% or so compared to our 5.5%. but let Modiji stay for another 5yrs and FD rates will probably go 0)
I'll say don't fall in the mutual fund trap. They're adverting it so heavily that I stopped even thinking about it.
As a quote goes: a man visited a Index fund manager's lavish boat. Excellent boat. But after the party he asked "where are the customer's yatchs?"
Indian MF/Index funds don't provide you a report asto where they r investing like Warren Buffet provides to his shareholders.
They're opaque and u hope to get returns. Nobody I know has actually got 30% or so returns.
Edit: sorry if I avoided pedantic I thought you are the one who asked the qn. I realise that you already know what I was trying to say.
2. As others pointed out, having an emergency fund set up and ensuring that you're taking advantage of all employer-matching and tax-saving benefits (both company and government). Different countries have different settings, so you could probably try and research those online, or ask someone you trust
3. Along with the Intelligent Investor, another book I found helpful was "A Random Walk Down Wall Street". This will help you understand ETFs and index funds
edit: If you're not in the US (or in a significantly well-developed economy), a lot of the advice in either of these books might not be as ideal as it would be otherwise. For example, in developing economies, beating of the index by reasonably knowledgable active investors is fairly common
4.
> Also, any resources for understanding index funds would be great. I know they are a basket of securities but I don't understand why they're traded on the stock market just like a stock
Index funds and Index ETFs are slightly different. Index Funds are not traded like a stock, Index ETFs are. Funds usually have a "Net Asset Value" which changes once per day. ETFs trade like a stock, and tend to fluctuate intraday.
5. Make sure you know what your investment temperament is, what your long-term goals are, and know all the mind games which you will play on yourself (not to mention the buttons the investment industry will try to push). Dan Ariely's courses and books can help a lot with understanding and minimizing irrational investment behavior.