Stocks are bought and sold based on short term price movements. Even institutions don't take more than four quarters view. As an individual investor, you can completely ignore short term and take a decadal view. That's why each one gets different result from the same stock.

Debt funds are generally good but still you need to understand this fine difference:

If you lend to banks, the risk is on banks.

If you lend to mutual funds, the risk is on you.

I remember reading in @Prashanth_Krish blog today that an Adani company had the same price in 2019 as that of 2010. Zero returns in 9 years. The one year return is so high that 10 year CAGR now is 30%

If you cannot understand this, long term investing is not for you.

"You don't drive a truck that weighs 9,900 pounds across a bridge that says "Limit 10,000 pounds" because you can't be that sure."- Warren Buffett

"With a wonderful business, you can figure out what will happen; you can't figure out when it will happen. You don't want to focus on when, you want to focus on what. If you're right about what, you don't have to worry about when."-Warren Buffett

Stocks need not move for few years and then give huge returns in a single year. Always staying invested is the only way to benefit from these movements. Most of us become impatient and quit thereby foregoing gains.

In investing doing nothing is the ultimate form of sophistication.

Missed Balaji Amines, got Saregama. Missed Borosil, got Hikal. Both errors of ommision and commision are a part of the game. Have an open mindset that forces you to look for opportunities and to learn from mistakes

Just the journey of Bajaj Finance proves it why it is difficult to hold businessess. People with different mindsets (technincals) or deep value kept making noise throughout the last 6 years.. business did what it had to do. Only very few I know have held it firmly

Holding the right business, it is increasingly becoming clear to me is the most difficult thing to do unless you write down your investing philosophy and know it in your bones

Li Lu is a well-known Superinvestor who has achieved a compounded annual return of about 30% since 1998.

He is also known for managing the money of his good friend Charlie Munger.

Today, he turns 56 years old, and on this occasion, here is some of his timeless wisdom👇🏼

1. Why Value Investing Works

The market isn’t created for value investors.

It is built in a way that increases the urge to speculate.

That’s why businesses are so often misprized in the short term.

Value investors can benefit from this circumstance.

2. Understand Who You Are

You’ll be more interested in some industries/topics than in others.

And in investing, you can choose in what industries you’ll look for opportunities.

Investors should use this advantage and be sure about their circle of competence.

3. Be a Journalist

Being an investor is a lot like being a research journalist.

You have to dig into the company on a level that journalists do when they research their stories.

You also need to clearly articulate your thesis and research and bring it to paper.

4. Find the Truth

A journalist also has to find the truth before he publishes a story.

Same goes for an investor. It could be fatal if he makes a decision before he knows “the truth” about a company.

Thus, he has to avoid all sorts of biases and misleading influences.