You start off in life thinking about investing, and end up reaching some place. Of course once you reach, you can say all that was part of strategy…but the truth is..well!

some of my lessons…

1. You do not need too many investment ideas: those who think that they need many investment ideas. Not true. I bought Cholamandalam and Coromandel International for the first time in 1986 – and not too much quantity. Perhaps about 500 each – both for dividend yield. I am still holding it, and no I have no regrets.
2. You do not need to wear a hat: I am a trader, day trader, short term investor, long term investor, value investor, momentum seeker, deep value investor – and I could have a little bit of Chola and Coro in all these portions. I do not see anything wrong – you have to be clear that each portion has a role. So I will happily buy Coro at 390 to sell at 435 – and not bother at all about say 20k shares lying in the ‘long only’ portfolio. These are separate transactions.
3. Markets never go up or go down. Never. Even in the so called 2003-7 fmcg, and pharma did not participate. However infra, banking, IT went through the roof. If you had sold LnT, Chola, Kotak, in 2008 and bought Hul, Nestle, Gsk – you would have rocked.
4. There are many players in the market and each has a different time frame and a different point of view. So a farmer in Haryana wanting to invest Rs. 20L goes and buys TCS on the same day when some junior employee of TCS is selling TCS to buy a house, and a senior executive of TCS is selling to paint his house. All of them are in the same market. All of them are bullish – remember all of them have a position in TCS after this transaction.
5. Corporate Governance – you need to get real close to a company to know whether they are serious about CG. I know of a company very high on CG which recently sacked a woman for bringing up ‘MeToo’ about a very senior executive. Powerful owners (stake owners) will not let things change so easily.
6. There are many things to know about a company and its promoters – the balance sheet is just a nice place to start.
7. If you are a generational wealth creator – you need a few ideas – maybe 5 in all your life.
8. My oldest idea (luck) has been MNC – their corporate governance, and willingness to share the profits. However even Colgate, and Hul have had many years of underperformance. However if you have been just a buy and hold investor since 1977, you have not done badly at all.
9. We made a research report on Supreme Industries in 1988. I have found no reason to sell it for the past 30 years. Ditto 1978 Hdfc. And 1994 Hdfc bank. You don’t need too many ideas, but you need to monitor their performance – and separate luck and skill. No. It is not easy.
10. At various forum I have heard Prashant Jain, Naren and Anand Radhakrishnan say ‘they got lucky’. If you think understanding risk is important, you have to realize that accepting the role of luck is also important.
11. Many successful people have simple lives – 2 sets of dresses, one car, index portfolio, no borrowing, ….you have to pick and choose what you like and aspire to go towards that. Morgan Housel for example is extremely fit – and I am sure it comes from sensible eating and sensible life-style choices. Many fund managers fit this bill…and IMPORTANTLY…many do not.
12. Your total portfolio return is far more important than searching for a single multi – bagger and not having the guts to put 20% of your portfolio into it. It is just a mental satisfaction…does nothing to your net worth.

a dozen is good enough….for a Monday morning I guess!!