As from April 2013 my Journey in Investing is to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

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This blog is authored by an old multi-bagger blue chips stock picker uncle from HDB heartland!

"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder

"For the things we have to learn before we can do them, we learn by doing them." - Aristotle

It is here where I share with you how I did it! FREE Education in stock market wisdom.

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Value Investing
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Thursday, 13 August 2009

Payback period

From Wikipedia, the free encyclopedia

Payback period in business and economics refers to the period of time required for the return on an investment to "repay" the sum of the original investment. For example, a $1000 investment which returned $500 per year would have a two year payback period. It intuitively measures how long something takes to "pay for itself." Shorter payback periods are obviously preferable to longer payback periods (all else being equal)

When come to stock investing, do you really seriously think and care about Payback period?

Any businessman will want to recover his capital quickly and then let the biz takes care of itself to generate future cash flow. He will then look for the next biz prospect to deploy his recovered capital.

For stock investing, why are we not thinking like a businessman? Shouldn't we quickly recover the invested capital and let the stocks take care of themselves to generate future cash flow. This is the similar method which I called it "Pillow Stocks Investing" strategy.

Read? Pillow Stocks Strategy
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