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Plain Truths About Stock Investing by Debashis Basu: A no-nonsense guide to smart investing

Debashis Basu’s Plain Truths About Stock Investing is a concise yet powerful guide that demystifies stock market investing. This 96-page non-fiction book, published by KenSource, provides practical strategies to navigate market risks and maximize returns. From risk control to technical analysis, Basu covers essential investing truths with real-world insights, making this book a must-read for every investor.

Plain Truths About Stock Investing by Debashis Basu: A No-Nonsense Guide to Smart investing

Why Should You Read Plain Truths About Stock Investing?

Investing in stocks can be both rewarding and risky. In bull markets, fortunes can be made, but when the tide turns, even seasoned investors suffer massive losses. How do you safeguard your investments while benefiting from the long-term wealth-building potential of stocks? Plain Truths About Stock Investing by Debashis Basu answers this crucial question.

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This book offers concise, direct, and vital advice on navigating the stock market safely. Basu distills complex investing principles into an easy-to-read guide, stripping away the noise and speculation often peddled by the media. Whether you are a beginner or an experienced trader, this book provides timeless wisdom for making informed investment decisions.

What does Plain Truths About Stock Investing cover?

What is the core idea of the book?

Basu emphasizes that stocks should be a fundamental part of any long-term savings plan. While equities have historically outperformed all other asset classes over long periods, they come with inherent risks. Investors often get caught up in bull market euphoria, only to experience painful losses when markets decline. This book teaches how to invest systematically, mitigate risks, and make decisions based on logic rather than emotions.

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How can investors navigate market volatility?

The stock market is unpredictable, with periods of boom and bust. Basu references the 1995–2003 period, when the market remained stagnant, discouraging many investors. His key takeaway? Markets may be volatile in the short term, but disciplined investing yields rewards in the long run.

To navigate this volatility, the book advises:

  • Avoid speculation and hype-driven investments.
  • Stick to a proven method and follow it with discipline.
  • Understand that market stagnation is temporary, but quality investments will pay off over time.

What are the Four Risk-Control Tools that actually Work?

Basu outlines four critical risk management tools every investor should use:

  1. Diversification – Avoid putting all your money in one stock or sector. Spread your investments across industries to minimize risks.
  2. Asset Allocation – Allocate your funds between stocks, bonds, and other asset classes based on your risk tolerance.
  3. Stop Losses – Set predefined exit points to cut losses early.
  4. Long-Term Perspective – Avoid short-term trading unless you have a well-tested strategy.

These tools act as safeguards, protecting investors from market downturns while ensuring steady portfolio growth.

Does technical analysis actually work?

Technical analysis, which involves studying price charts and indicators, is a popular but controversial method in stock investing. Basu critiques technical analysis, highlighting that while some traders succeed using it, it doesn’t work consistently for long-term investors.

The author suggests:

  • Technical analysis can help with short-term trading but should not be the sole decision-making tool.
  • Fundamentals of a company are more important than price charts.
  • Market trends can be unpredictable, making chart-based predictions unreliable.

What Are the 10 Essential Success Factors in Stock Investing?

Basu presents 10 key principles that successful investors follow:

  1. Invest in businesses, not stocks.
  2. Avoid market speculation and tips.
  3. Understand the company’s fundamentals before investing.
  4. Be patient—great investments take time to grow.
  5. Don’t panic during downturns.
  6. Use risk control measures.
  7. Follow a disciplined investing strategy.
  8. Ignore short-term noise from media and experts.
  9. Reinvest dividends for compounding benefits.
  10. Stay updated with market trends but don’t chase fads.

Can short-term investing work?

Basu acknowledges that short-term trading can be profitable but warns that it requires:

  • Deep market knowledge.
  • Quick decision-making skills.
  • A well-tested trading system.

While some traders succeed, long-term investing is a more reliable wealth-building strategy.

What are the 6 Silliest Mistakes investors make?

Many investors fall into common traps, including:

  1. Chasing hot stocks based on media hype.
  2. Ignoring risk management.
  3. Timing the market instead of time in the market.
  4. Falling for investment scams and Ponzi schemes.
  5. Overtrading, leading to high brokerage fees.
  6. Not diversifying properly.

Avoiding these mistakes can significantly improve investment outcomes.

A Famous Quote from the book

"Stocks should form an essential component of any savings strategy because over very long periods, stocks have delivered a higher return than any other asset class."

What’s happening in the Indian Stock Market in 2025?

As of 2025, the Indian stock market has reached record lows, driven by FII outflows and a week rupee.

Investors are optimistic, but experts warn that overvaluation concerns and global economic factors could lead to further corrections.

5 Bestselling Stock Market books to read in 2025

  1. "The Psychology of Money" – Morgan Housel
    A must-read on how human behaviour affects financial decisions.

  2. "One Up On Wall Street" – Peter Lynch
    Timeless insights on identifying winning stocks before they go mainstream.

  3. "The Intelligent Investor" – Benjamin Graham
    The ultimate guide to value investing, as endorsed by Warren Buffett.

  4. "Common Stocks and Uncommon Profits" – Philip Fisher
    Great for understanding how to evaluate businesses and their growth potential.

  5. "The Little Book That Still Beats the Market" – Joel Greenblatt
    Introduces a simple, formula-based investing strategy.

Where does Plain Truths about stock investing fall short?

While the book offers valuable insights, it has a few drawbacks:

  • At 96 pages, it’s relatively short, leaving some topics underexplored.
  • Published in 2006, some content may feel outdated compared to modern investing trends.
  • The book lacks detailed case studies on stock-picking strategies.

Despite these issues, it remains a great starting point for investors seeking foundational knowledge.

💬 What’s your current read? Have you read this book? Share your thoughts in the comments!
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*Tushar Mangl writes on books, investments, business, mental health, food, Vastu, leisure, and a greener, better society. Speaker, author of Ardika and I Will Do It.

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