Key Learnings from one of the best Investing Letters that I have read this year from @rohitchauhan

Time for a thread with SOIC Key Takeaways ๐Ÿงต๐Ÿงต๐Ÿงต๐Ÿงต

First Key Learning:

The first is the importance of getting the trend and its timing right. No business does well in isolation, it is a part of a much bigger trend. For eg:In sectors like API/CDMO/Chemicals, many businesses have created wealth. As they are going through tailwinds
Thus,It becomes important to identify long-term trends like manufacturing, Financialization of saving, or Formalization of sector (think PVC/CPVC Pipes) and to be patient. Long-term trends keep offering opportunities. Just think about it- if its truly long term, then the
Opportunity will exist for a long period of time no?

Second Key Learning:

Look at Valuation in a broader context and not in isolation. When a sector catches fancy of the markets, and earnings growth is strong in the entire sector. Most of the time, markets start discounting
the earnings and reward the business with a high multiple. As long as the trend holds and management is executing, one should hold the stock and be tolerant of higher valuations ๐Ÿ’ฏ๐Ÿ’ฏ๐Ÿ’ฏ
Third Key Learning: Boredom is the enemy

Unlike cyclical stocks,, timing the purchase is not critical. Most of these trends last for a long time. Betting on the right management and holding through periods where the business keeps moving forward, but the stock price remains
stagnant is the key. This reminds me of Pi Industries and Syngene. Pi went through a stagnant period between 2016-2018 and Syngene is going through one right now. Given the trends last for a long period, it is okay to hold through and to reap the rewards as markets are non-linear
You will make returns in phases. This is a hallmark of long-term investing.
Fourth Key Learning: Diversification is not just about position size, but also the underlying economic drivers behind each company. Suppose if you own a Building Material co and a Real estate company. The underlying economic drivers remain the same. If you are looking to
diversify properly. Then even the underlying economic drivers of the business have to be different. An example that comes to mind is Navin Fluorine and Prince Pipes. Both the businesses have different underlying economic drivers, which leads to proper diversification.
Last Key Learning: Simplicity is the key

"When I started investing, I thought there is some magic formulae to grow your capital. After 10 years of search, I realized that the answer was staring me in the face.
The key to wealth creation was very simple โ€“ Save aggressively and invest patiently." - @rohitchauhan

More from Intrinsic Compounding

More from Wise investing

You May Also Like

๐™Ž๐™๐™–๐™ง๐™ž๐™ฃ๐™œ ๐™ข๐™ฎ ๐™ฌ๐™ž๐™จ๐™™๐™ค๐™ข ๐‘พ๐’๐’'๐’• ๐’ƒ๐’† ๐’”๐’–๐’“๐’‘๐’“๐’Š๐’”๐’†๐’… ๐’Š๐’‡ ๐’•๐’๐’Ž๐’๐’“๐’“๐’๐’˜ ๐’– ๐’“๐’†๐’‚๐’… ๐’•๐’‰๐’† ๐’”๐’‚๐’Ž๐’† ๐’”๐’•๐’–๐’‡๐’‡ ๐’Š๐’ 50๐’Œ ๐’˜๐’๐’“๐’Œ๐’”๐’‰๐’๐’‘ ๐’๐’“ ๐’”๐’๐’Ž๐’†๐’๐’๐’† ๐’Ž๐’‚๐’๐’‚๐’ˆ๐’Š๐’๐’ˆ ๐’š๐’๐’–๐’“ ๐’Ž๐’๐’๐’†๐’š ๐’˜๐’Š๐’•๐’‰ ๐’”๐’‚๐’Ž๐’† ๐’๐’๐’ˆ๐’Š๐’„
Simple and effective way 2 make Money


Idea 1:- Use pivot level like 14800 in case of nifty and sell 14800straddle monthly expiry (365+335) exit if nifty closes on daily basis below S1 or above R1

After closing below S1 if it closes above S1 next day or any day enter the same position again vice versa for R1

Idea2:- Use R1 and S1 corresponding strikes multiple
Incase of R1 15337 take 15300ce
N in case of S1 14221 use 14200pe
Sell both and hold till expiry or exit if nifty closes below S1 or above R1 around closing
If the same bounces above S1 and falls below R1 re-enfer same strikes

Use same criteria for nifty, usdinr and banknifty

(This is must)Use this margin rule for 1lot banknifty pair keep 4Lax margin
For nifty one lot keep 3Lax
For usdinr 100lots keep 4Lax

I bet you if you do this on consistent basis your ROI will be more than 70% on yearly basis.

Couldn't explain easier than this

Criticisms are most welcomed.
**Thread on Bravery of Sikhs**
(I am forced to do this due to continuous hounding of Sikh Extremists since yesterday)

Rani Jindan Kaur, wife of Maharaja Ranjit Singh had illegitimate relations with Lal Singh (PM of Ranjit Singh). Along with Lal Singh, she attacked Jammu, burnt - https://t.co/EfjAq59AyI


Hindu villages of Jasrota, caused rebellion in Jammu, attacked Kishtwar.

Ancestors of Raja Ranjit Singh, The Sansi Tribe used to give daughters as concubines to Jahangir.


The Ludhiana Political Agency (Later NW Fronties Prov) was formed by less than 4000 British soldiers who advanced from Delhi and reached Ludhiana, receiving submissions of all sikh chiefs along the way. The submission of the troops of Raja of Lahore (Ranjit Singh) at Ambala.

Dabistan a contemporary book on Sikh History tells us that Guru Hargobind broke Naina devi Idol Same source describes Guru Hargobind serving a eunuch
YarKhan. (ref was proudly shared by a sikh on twitter)
Gobind Singh followed Bahadur Shah to Deccan to fight for him.


In Zafarnama, Guru Gobind Singh states that the reason he was in conflict with the Hill Rajas was that while they were worshiping idols, while he was an idol-breaker.

And idiot Hindus place him along Maharana, Prithviraj and Shivaji as saviours of Dharma.