Amazing inaction is required..
Fortunately or unfortunately most of the net wealth that I have created is by being in the markets and for long periods of time. However this did not lead to a career in Portfolio Management Services – simply because the method of compensation and the amount of compensation did not attract me at all. If there was a business where there is a conflict between ‘action’ – and he client feeling that something was happening and me feeling that nothing was necessary, it was in the PMS ‘profession’. Let us take an example if I had bought Gillette, Colgate, Wipro, Hdfc, Hero Honda – say all in 1985 – and held on till today…how many of you would have paid 2% per annum (on increasing prices) for INACTION? Want an honest answer.
So to make money I would have had to sell Wipro buy Silverline (you want action, I have to make a living), sell Hero Honda to buy Kinetic Honda, etc. maybe both of us would have been happy, you would have been poorer.
If I had done nothing, but just sent the bill, you may not have paid at some stage.
Of course there is another set of clients who would have said..’I agree Hero Honda has done well from the year 1985 to 2009, however, we could have sold it, bought it back, ….and thus improved the return. Very difficult to talk to people who have 20-20 hindsight.
Why I know of an amazing lady who had a messy equity portfolio (Rs. 100,000 perhaps in 2000) – and very scared of equities. A friend of mine who also happened to be her neighbor introduced her to a PMS provider (again a friend of mine!) – in the years from 2002 to 2004 her portfolio doubled. Then again doubled in 2005-6. This was FAR superior to a mutual fund – forget the index. So crudely put her returns went up from sub-7% of her own making to about 42% p.a.
She was not happy….because the PMS manager had not captured some tops and bottoms.
So happy not to be in PMS ..but in training. Hopefully my client knows what I want, and the requirements are for a day, not a decade.
Muthu
I agree with you. Good to know that you are in a ‘value addition’ profession of training rather than ‘churning’ profession of PMS. That lady’s greed is akin to a recent story you wrote from Hindu Mahasumdram, about a guy desperate to completely fill the last jar of gold coins.
We follow your principle. Whatever financial independence I’ve acquired in my life, is purely through sitting tight, not by endless excitement called trading.
To quote a trade & investor, George Soros, ‘If investing is entertaining, if you are having fun, you’re probably not making any money. Good investing is boring’.
subra
Comment sent through E-mail: C S Narasimhan
I read your blogs once in a way – perhaps once a month some selected ones of interest to me. Couple of days back i happened to open your website to read a few. I thought i must make some constructive remarks on the way the site is evolving:
Initially,the content was really good and I enjoyed some of them which had something new or profound to say(for example.your posts on students,retirement,doctors and even the ones on investments on Housing although a bit controversial). Several of them did invite some good and healthy debate as well.
In contrast,now i think you have allowed your site to be hijacked by readers – its a free for all! This is partly because you are digressing from the topic or the topic itself has very little new to say. I know it is difficult to say something profound every day. In that case u should consider reducing frequency of posts. what is sad is people are using ur space to settle scores. It has become more like our parliament where people are blaming each other,exhibiting one-up-man ship,self projection without context etc.
if u are not careful,u will find yurself sucked into doing all the above things eventually.
I think you should do something to bring sanity to the site.
subra
Agreed CSN,
will keep it in mind. More importantly very, very difficult to put editing rules. However one imp rule at least from today is ONLY I AM ALLOWED to post anything about any company stock. A friend working with the regulator (abroad)- warned me about blogs being regulated by the regulator and was speaking about some sticky issues. When I write about a share, at least (hopefully!) know what I am saying. Editing takes time and is likely to bring bias, so was avoiding it…
Venshu
Dear Subra,
Your Blog’s comments section was such a nice place prior to 13th September and since a certain reader started using the comments section starting from your ‘Investment Myths: Trading or Investing?’ blog (dated 13th Sept) to pick up a fight with you/further his own interest/show one upsmanship, your comments section has never been the same. Instead of changing your editorial policy, why don’t you simply ban the errant reader and allow sanity to return to our most loved blog?
We want our old ‘Subramoney Blog’ back. It would be very sad if we have to go forward with editorial controls, regulation, moderation etc!!
I am begginning to wonder now if this was a part of a larger conspiracy and an attempt to sabotage your blog and its popularity?
Asoke
sabotaging subra’s blog is difficult..it is a one man show. If he keeps out a few people, the blog is back. However Subra you should listen to the majority…please keep people who talk about ‘themselves’ too much. Modesty may not be a virtue, but self trumpet blowing is SICK..please listen to the majority. Just a request.
Vivek
I agree with the above posts. The gentleman should be gently reminded that general nature of his comments are self promotive in nature.
rohit
Hi Muthu
I am now reading your blogs quite regularly -quite amazing
subra this reminds me of one of mine yours favorite artcies
-Paid subscription dream
http://www.subramoney.com/2009/04/market-timing-is-so-easy/
sorry Rohit and Muthu – not to keen to carry any negative remark about anybody else. If he is running a wrong business please complain to Sebi. I suddenly do not want a defamation claim based on a comment. Self preservation you see.
Muthu
I’ve been visiting this blog for the last few months and I’ve seen individuals mentioning about individual stocks. If there is going to be a blanket ban on writing about individual stocks, I’ve no problem adhering to that. Mr.Subra also may avoid writing about individual stocks, which makes others also to write the same. Certainly it is his blog, but since it is in public domain, comments would invariably follow the nature of topic.
Mr.Subra has right to close his blog for ALL comments. I do not know how a few gentlemen can claim that only there thoughts are eligible for view and others need to be banned. What are your yardstick guys?
We are living in India – majority cannot suppress intellectual minority. I would see how I can improve quality of my comments. I’ve no intention of bowing down to the majority and would continue to post my comments. Rohit- Amongst so much malice, heartening to see some words of encouragement.
Chaitanya
Mr Muthu,
First thing. We are here to read Subra’s blog and a healthy discussion. We are not here to comment/judge everyone who writes here. At the end of day one should get something out of these discussions.
What most of the readers feel is your comments are more than discussion. Something like final judgement on every topic and you being like super investor who is enlightening everyone including Mr. Subra.
My sincere request to you is stop being hypocritical. Those who read this blog have definitely some level of so called intellectualism. If you are super intellectual then you do not need to post your comments on each and every article Mr. Subra writes. You might be very bright student/person or whatever. You will have your days. Your blog may become one of the most popular blog. But stop trying to be like a anchor in TV show who keeps on commenting his own ideas.
There is no harm in accepting your faults that would increase people respect for you. Accept the wrongs and move on buddy. God bless you.
Thanks
Chaitanya
Sanjeev Bhatia CFP
Dear Subra,
I fully endorse the views of Asoke and other readers who feel peeved after 13th Sept. I also feel that the self trumpet blowing You-Know-who has created a lot of disturbance in our much loved and hitherto peacfull blog. Too much “I”s in the comments and then claiming to not trying to hog limelight is a big No-No. the gentleman is free to harp on his credentials, his acumen and everything else that goes with it in his own blog rather than trying to ride piggy back on imaginery offences.
Pls do something to bring sanity back.
Muthu
Mr.Subra – You mentioned on the other day to ask people to stop criticisng me. You also suggested ‘no advice to Muthu’ and ‘no advice from Muthu’. Please request people not to use this forum for settling internal scores. Let them email me and I would give them a deserving response.
I only react to when I’m targeted and I never on my own target anybody.
Let people learn public manners.
raag
Subra,
If someone had bought HUL (HLL then) in 1998 for Rs. 200 and held it till now (2010), what CAGR would she have got? Was (Is) HUL not the bluest of bluechip? You keep mentioning Hero Honda but what if someone had bought HUL? Everything looks rosy in hindsight i guess.
pravin
uh..whats with the hatred against muthu, i suppose.since nobody is naming names and just beating about the bush with ‘gentleman who blows his trumpets?’. cant people who dont like comments,er,just ignore them?. though i read subra’s posts daily, i feel free to ignore the comments or even main posts,if i feel its not worth my time. lets use our own personal gas detectors.
subra
only problem is there is no website that will calculate CAGR for you. For example if you bought HUL in 1976 for Rs. 19 (OMG, it was a Rs. 10 share) or Colgate in 1978 for Rs. 25 calculating CAGR is difficult. You should actually take the cost price (and assume you bought shares of the same company for an amount = the dividend)..then calculate the CAGR. HUL has been a huge laggard over the past 10 years. It may have still beaten the index. However HH, Colgate, Gillette, PnG, Hdfc, Hdfc bank…etc would have licked it by a mile. Having said that the whole thing would look foolish if HUL were to double in the next 3 months…LOL
Muthu
Chaitanya- It is my right to post a comment for every single article, if I want to. It is your right to ignore it. Why don’t you learn something from people like Pravin? I’ve no intention of accepting any wrongs and move anywhere, you can keep your God’s blessings. I don’t need it from or through you.
Sanjeev Bhatia CFP – Envy would do you no good. Your sanity or insanity is in your own hands. You may seek an expert help for being sane. Bringing you sanity may not Mr.Subra’s cup of tea.
Sanjeev Bhatia CFP
@ Muthu,
Till date, I have never said anything against you but if I feel that after you started posting your comments, the peace of the blog has been disturbed, I have the right ot say so.
Envy? of you? Grow up, Man.
raag
Subra Sir: My point was how do you explain (or console) someone who had bought HUL for ~200 bucks in 1998? All the following points would appear hollow to her: 1) Equity gives good returns, 2) One should have long-term (I guess 12 years is long enough) view in equity investing, 3) Invest in stocks of companies that are tangible (i guess no other company gets more tangible and intimate than HUL) and have good “moats”, 4) Look at good management (cream of IIMs – at least till sometime back). So, where did all these theories break down in case of HUL? Or is it just luck? 🙂
venshu
@ Muthu,
The quality of your comments when viewed in isolation is not at all an issue here. But the same can not be said about the relevance of quite a few of your comments.
While everyone will appreciate intellectuals, I am sure a lot of us agree that intellectuals too have their failings especially when they share the platform with lesser mortals who are here to read and learn from Subra’s blog posts and who are certainly not here to find out about your interviews / programmes on TV Channels, your favourite quotes from your favourite books on investments,name dropping – Soros, Lynch, Buffett etc.
If you call my honest and direct comments as spitting venom, then I am deeply dissappointed with your understanding of the situation here. You can get annoyed with our comments but we should not comment on the irrelevance of your comments! How is this for Democracy?!
If you can keep your comments objective, and relevant the problem should go away automatically and the take with it all this acrimony.
I appreciate that as the Citizen of India, you have your rights to ignore my comment compeletely and not to do any of the above and continue in the same vien as you have been (on Subramoney). We too have our rights as your Compatriots!!
I believe that what I have said above you is probably against your attitude but not against you as an individual. Nothing personal. As a Citizen India, am expressing my thoughts here whether you like it or not. You can choose to ignore my comments as you want us to do with your comments!
Gurdial
@ raag,
As HUL shows:
1. Long term view (buy & hold) does not mean you dont track the performance / underperformed of the stock every couple of quarters.If its not living up to your expectations consistently-switch.
2. It also shows why diversification is a must. If HUL underperformed other like Colgate, Gillette, PnG, Hdfc, Hdfc bank etc would have delivered.