Share Market is only place where except fall in markets n euphoria,

Majority of the times

Fall in price ≠ CHEAP / DISCOUNT

And rise in price ≠ EXPENSIVE

Business performance is ignored

Many keep averaging down n don't add at higher price when business improves

#investing

Do you know below companies were Most Valuable top 10 companies in India between 1995 to 2010..??

Where are they now? What CAGR returns did they generate? Why?

- Century Textiles
- Brooke Bond
- Hindalco
- Tata Communications
- IDBI Bank
- Indian Hotels
- Satyam Computer

(1/2)

- NIIT
- Zee Entertainment
- Indian Oil
- Himachal Futuristic
- Reliance Infra
- RCOM
- Suzlon Energy
- DLF
- Unitech
- Reliance Power
- Sterlite
- Jindal Steel
- Cairn India
- Coal India

This is how survivorship bias can be studied..

#investing #TechnoFunda

(2/2)

@Sanjay__Bakshi @iancassel Thanks Sir for amazing insights as always.

To fight some of these "bad demons" I keep doing experiments like averaging up..

Also, during feeling of high PE or market overvaluation, I try not to take profit, but trail exit and give room of 20-35% drawdown to excellent businesses

@iancassel Also, I am experimenting few indicators which will help me re-enter known great business again (even if I exited at lower price) and help remove price anchoring in objective way..

Let's see how it pans out..

But yes... ultimately anyhow we need to conquer these demons 😀

Biggest mistake many investors make in highly cyclical sectors like steel, sugar, metals etc.

is that...during upcycle they assume earnings to be structural and get swayed away by optically low valuation thinking it as value buy..

Result... averaging down during fall n disaster

Mega thread on how the India’s Largest Telecom Operator – Reliance Jio (~35% market share) came into existence & became India’s Largest Mobile Broadband in less than 2 years.

Crazy story...no less than revolution..

Please retweet and comment below if you got blown away..

(1/n)

1 >> It was year 2011...year of spark

"The idea of Jio was first seeded by Ambani’s daughter, Isha, in 2011. She was a student at Yale (in the US) and was home for holidays. She wanted to submit some coursework and she said, 'Dad, the internet in our house sucks'," he recalled.

2) There was opportunity...

What was that?

That big thing...that will change India forever...for good..

Ambani said - Akash, at that time, stated that in the old world, telecom was the voice and people made money on calls but in the new world everything is DIGITAL...!!

3) That was it - DIGITAL

One simple but powerful idea..high speed internet is future

After the conversation, he researched more about it & found out that India was suffering from poor connectivity of data & prices were high which was not affordable to majority of Indians.

4) But it was not easy...

Dream was BIG...but it was game-changer...

After years of planning & research, Jio was finally launched on 5th September, 2016.

There was lot of competition...but Winning is their DNA..

Must read #TechnoFunda books:

Invest in Yourself

https://t.co/qPVhlS7gGx

#investing

Ben Graham:

The success of an investment ultimately depends on the future developments but they can never be forecasted with accuracy.

But if you have precise information about a company's present situation, then you are better equipped than others in understanding the future.

The first step to understanding the present situation of any company is to correctly understand and interpret its financial statements:

Cash Flow Statements,
Balance Sheet and
Profit & Loss Statement.

Investing tid bits...

Being an investor does not mean your Investment decisions are based on quantity or no of investments per quarter or year. It is all about Quality of investment decisions.

It may be just 1 or 2 per Q/HY/Y

@Tom_Voltz1 1/

That’s a possibility.

Buffett has this concept of “owner earnings”: how much cash can be safely taken out of a business each year without hurting it?

Take out more than this, and we risk hurting the business’s competitive position, earning power, unit volume, etc.

2/

At the same time, leaving capital in a terrible business is not a great idea either. It’s like throwing good money after bad.

In fact, directing capital away from textiles (a bad business) and into insurance (a better business) is one reason for Berkshire’s success.

/End

The weakness of someone's investment thesis is highly correlated with how angry they get when someone dares to question the investment.

Investors who are confident in their positions do not care if someone disagrees or if the language they use to disagree is "insulting".

I can think of two groups of investors who generally get VERY, VERY angry when their investment is questioned.

One is a company run by a megalomaniac who claims to be saving the world and leading humanity to Mars.

The other was created by an anonymous person in January 2009.