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Interview with 9 Ace Personalities!

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Foreword by Fundamental Investor -

I must begin by congratulating Aditya Kondawar for his wonderful contribution to the Investing
Community. In our culture, we all grew up inspired by stories of great individuals who contributed to
the well-being of the world. Their life learnings & mistakes gave us a direction. Reading various
experiences definitely enriches our thought process & thereby, improves our quality of decision
making & execution.

Having said this, in Life & in the Equity Markets, the best form of learning is by Self Experience. We
must remember that the Dynamic Stock Market provides different experiences to every individual
based on the choice of business, the entry price, the time horizon & turn of events in the journey. A
loss making experience for a person in 1 year might result into a profit making experience for
another person in 10 years. The reverse is also possible. In short, what works for someone need not
necessarily work for another person in the ever-volatile market. This is what makes Equity Investing
so Dynamic & Special.

In this book are 9 rich experiences of Investors. I know a few of them personally & have immense
respect for their rich understanding of Personal Finance & Markets. As I went through this book, I
also got to understand multiple principles which worked for the contributors. This book gave me an
opportunity to reflect on their learnings & see what worked for me personally.

The beauty of this e-book lies in the wide spectrum of experiences which include Personal Finance,
Compounding, Fundamentals, Mistakes, Speculation, Strategies and much more. Some concepts are
beautifully articulated by the investors. I personally liked each person’s story of Entry into the
Markets & their journey for over a decade. Their learnings are Pearls of Wisdom for all of us.

I would recommend the reader to enjoy going through the experiences, apply the learnings & create
a wonderful self-experience. I wish the 9 Investing Contributors the very best & encourage them to
continue guiding the Investing Community.

Best wishes. Enjoy the Experiences…

Yours,

FI

Learn with him @ www.fundamental-investor.com

Follow him on Twitter by clicking here

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 Vivek Mashrani

Founder of TechnoFunda and Twitter Influencer

How did you start your investing journey - What got you to the markets, how did you get
interested in it?

Initial interest started way back in 2004 during my college days as many of my relatives were into
investing. Formally started investing (I would say more of trading actually) during 2006-2007 with
very small capital. Just sheer dynamic nature of markets got me interested in it

The first stock you bought, first loss and what did you learn from it?

Well, like everyone else who starts into stock markets, I too mostly bought junks in my initial years.
First stock was Karuturi Global (which is almost bankrupt company now). Had bought many such
junks in my initial years. Biggest learning was of course to never compromise with quality of
businesses (which came much later), but I have still 1 share of each of these (some even have got
delisted now) so that I get reminded of my mistakes and ensure I don’t repeat them.

One advice you would like to give to younger people who have just started earning toward the
financial freedom journey.

Keep high savings rate. Keep investing in quality businesses. Be disciplined in spending habits. Don’t
borrow.

Can you tell us a bit more about TechnoFunda and what led you to founding it? What are your
future plans for it?

Well, my formal education at NMIMS which was MBA in Capital Markets (in association with BSE). I
got introduced to array of subjects like fundamental analysis, business valuation, technical analysis,
SEBI laws etc. and had ample of reading materials in my library around it. By studying them
altogether I realized that they are not different streams of stock markets but complimentary to each
other. I was again fortunate to have very good teachers, mentors and guest lecturers from industry.
This is when I tried to blend both these approaches and got interested into TechnoFunda approach.
And later kept on discovering new strategies and techniques which were very powerful for investing.
Future plans are more around spreading awareness around power of blending technical and
fundamental analysis through various channels.

Some insights on your stock-picking process.

In simple terms, I seek to find businesses which I can remain invested for long time and have quality
management along with inherent competitive advantages. I use technical analysis to screen some
trends and then apply my fundamental analysis to validate quality parameters around industry,
financials, business model and competitive landscape.

With the current market conditions of bearishness, what do you think should be done? How
should people control their emotions?

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As a long term investor, we should always be delighted with bearishness and keep buying ownership
in great businesses. Actually, if we think as partners into these businesses then there is no need to
control our emotions (as we will be in fact happy when price falls)

What are your favourite books?

Listed here: https://www.technofunda.co.in/books/

What are your hobbies?

Swimming, Table Tennis, Reading Books, Travelling

How did you increase your market knowledge?

First, by doing my formal course MBA in Capital Markets helped me immensely. I was blessed and
fortunate that I had excellent faculties and market practitioners who came to teach us. Then of
course reading lot of books helped. We also had live mock trading room which also helped. Later
stage applying and trying to validate concepts in the market. And recently networking with like-
minded investors have helped immensely in idea generation and exchanging notes/experiences on
AGM/Management discussions etc.

What are some steps/rules in money management you think goes a long way to help the saver get
the best out of his savings/investments?

Think Long Term. Act Long Term. Partner with people who believe in long term.

What are the basic metrics you look at a business when you are valuing or looking at it to invest?

I start with qualitative factors like longevity, durability, competitive advantages etc. and validate
them with quantitative factors like revenue growth, margins, RoE, RoCE, cash flows, working capital
cycle etc. Then of course trying to value them on relative and intrinsic basis.

Any example where patience has paid off for you.

There are many such examples. One such is investment into Vinati Organics which I have now held
for ~10 years and have patiently held during ups and downs. The market cap since initial investment
is now 40x.

Who is your role model in investing?

I don’t have a single role model but many for various styles of theirs. Prof. Sanjay Bakshi, Sanjay Ved,
Charlie Munger, Peter Lynch, Bharat Shah are few whom I admire.

Disruptions - What do u think of them and how do u see if a business you are looking as a
prospective investment won’t get disrupted easily?

I think disruptions are part of business ecosystem and will keep happening. The pace has accelerated
quite significantly in recent times. One way is to look at competitive advantages for how business
protect themselves and other interesting aspect should if a business can themselves disrupt
internally and evolve to be better for tomorrow. I think looking at the lens of companies who are
evolving and able to transform with disruptions should be ideal candidate for investment.

So many quotes from Mr Warren Buffet and Peter Lynch , any quotes that didn't work for you?

Well, they all work differently in different times. So, no point in discussing them here.

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When do u sell a stock? What is the criteria according to your rationale that a stock has reached its
life? When do you know it’s time to get out of a stock?

I use blending of technical indicators to take sell decisions along with fundamentals of the business.
Significant impairment of business quality, realizing that management is crook etc. are in fact non-
negotiable reasons to sell.

In your investing journey - one thing u did which you think you did great and one thing u regret
doing?

Glad that I read so many books (of various subjects) in my life so far and understood importance of
saving very early in my life. Regret is that I wasted my initial years of stock market in trading, F&O
and buying junk businesses, wish I could have got in touch with mentors/gurus at early stage.

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 Pankaj Baid

Twitter Influencer and Senior Management Consultant

“This is Pankaj Baid, a long term investor and a senior management consultant with
rich experience in management consulting, research and analytics services for
leading global organizations across the private, public and social sectors. I have
worked with leading global investment banks and rating agencies in the past.”
Also, I am a Trustee at a registered charitable trust named ‘DUA – The Joy of
Sharing” with 150+ members founded in January 2015.
I am passionate about value investing, traveling, reading and parenting. Lastly, I am
an optimistic and religious person with basic expectations in life. I always believe that
the more you learn, the more you earn. So never stop learning. Life and Investing
are no different.
I started at the age of 17. I come from an investing business family which has always
believed in the power of compounding. My two multi-baggers have been my grand-
dad and dad who started investing way back in the 1970s.I learnt about businesses,
management styles, investing mantras and of course a lot on mental behaviours (I
would rate this as MOST important). There is no better alternative if you can learn
things at home from the experts. That was my motivation towards markets.
With my first stipend and salary I invested in Bosch, a German MNC innovative
leader. I just knew at that point, this giant manufactured everything under the sun
from sewing machines to heavy duty products. I learnt after the 2009 financial crisis
how quality stocks rebounds quickly.
That very mistake which I could have changed early was differentiating an unethical
and ethical management. Sometimes notorious activities by unethical managements
burn the entire credibility of that business. I made some mistakes which taught me
that very thing. I accepted that, learnt from it and moved on. It is imperative to always
keep improving your investing style.
Few Pointers I would to give to younger people who have just started earning toward
the financial freedom journey -
Go behind ethical management, a growing business and an affordable
price.
Be humble and ready to change your views without any bias.
Think long term, have patience and discipline in your investing approach
and stay away from FnO (Futures and Options) for sure.
Make mistakes early and learn. Learn and never repeat them.
Price and age are just a number.

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 Time is as valuable as money. Use your time to make money work for
you.
You can’t change things beyond your control but can change yourself
Invest time & money in yourself. Your behaviour will take you a long way!
Tips are deep PITS! Avoid!
My Investing Style -
Prefer businesses that have survived over 20-30 yrs with potential growth
ahead. A man is known by the businesses he owns.
I would any day prefer investing in FMCG/IT leader than a new entrant
with an exciting storyline.
If you look around your home, you will always find things which are less
disruptive and have a consistent demand in years to come.
I just go behind those well-known names. Shareholders reap their
benefits over the long run.
Remember 80% of the returns come in 20% of your holding period.
Always avoid taking leverage (F&O) to buy high debt companies. It is a
gamble, not an investment.
Of course capital protection is more important than returns right.
My Favourite books are Intelligent Investor, Rich Dad Poor Dad and Common Sense
investing. I consider Samir Arora and Ian Cassel as my Mentors.
In addition to investing, I am passionate about parenting, reading, value investing
and traveling.
A few pointers to increase one’s market knowledge - Keep reading about
businesses, disruptions and consumer sentiments that affect those businesses and
management decisions during such times.”

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 Venkatesh Jayaraman

Twitter Influencer, Youtuber

Author of Ebooks on Personal Finance and Insurance

I was brought up in Chennai and my Dad was a Technician in one of the TVS group
companies. I have done my MBA. For my career requirements, I move around
Bengaluru, Chennai, Mysuru and Pune. Though I primarily live in Bengaluru and
Chennai. I started investing in stocks from Jan 2008 and since then it is a long run of
close to 12 years.

(2) How did you start your investing journey - What got you to the markets,
how did you get interested in it?

 Personal finance had been my favourite topics from my childhood days. My

interest became more after I started to earn. All my savings were in bank
deposits and 1 mutual fund.
 Even a month before starting to invest in stocks, I was a person who did not
want to invest in stock markets and stick with only bank deposits.
 A few colleagues used to trade daily and make a few thousands a day, in a
few hours with a mere 30-40K capital! – This was in December 2007 when the
markets hitting all time high every day.
 Seeing them, I made by up mind to invest in stocks in January 2008! A
remarkable change in mind set in a span of 1 month.
So “Greed” brought me into markets.

(3) Tell us more about your YouTube channel and what plans do you have for
it? How did you start it?

CHANNEL OBJECTIVES

 Share more interactive contents in Personal Finance and Stock markets

instead of the usual PowerPoint or pdf that I share over Twitter
 I wish the audience to actively use these learnings by taking time to listen to
these videos (Not just hear during filler time i.e. While travelling to office),
make notes of what is said, reflecting on the idea and implementing them in
their investment journey. (Implementation is the key as it throws lot of
challenges and raises many questions)
FUTURE PLANS

 It all depends on how well the contents are received by the audience

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  Currently I fear that most of them passively listening to my content, which is
clearly visible from the nature of comments from the viewers
 There are hardly any comments on the issues they face post implementing
the learnings
I will take a call may be in January next year to continue uploading contents in the
channel, based on active involvement of the audience.

(4) The first stock you bought, first loss and what did you learn from it?

My first stock was Reliance Power! I applied for demat account during the IPO frenzy
of Reliance power. Everyone knows the lessons from Reliance Power. Nothing
specific for me to add.

I started investing from February 2008. I was not into trading or F&O. I was buying
and holding stocks for a few days or months with the intention of selling it with some
%-age of profit, say 20%. But almost from the time I started in Feb 2008, markets
were trending continuously down till the end of October 2008. So, there was no “first
loss”, everything was a loss from the time I purchased. By October 2008, I was
sitting on a loss of close to 85%. I did not have the financial and mental strength to
pursue any further investing.

A better question would be, “What was your first profit?” Well, I told that my dad was
working on a TVS group of companies. I was emotionally attached with the idea of
owning a part of my company that my Dad is working in. It was regularly paying
dividends, and its dividend yield was attractive at those rock bottom prices in 2008.
So, I continued buying more as its prices fell. I was holding it for a quite long time
and then sold it for a 3x gain (The stock went up to 10x post my sale!)

To sum my learnings in the initial stage -

Mistakes Lessons
~75% exposure in Realty like Unitech, - No over exposure to one sector
Ansal Properties, Parsvnath, Omaxe etc. - Avoid hot stocks /sectors
All of which were badly butchered in the
2008 downturn.
My only strategy then…Pick stocks with - PE as standalone tool is not a suitable
low PE values, thinking they were for valuation.
cheaply priced, not realizing that they - With falling earnings, PE becomes high.
were cheap for a reason.
Before entering the game, understandI had no business in investing, if I could
the rules. I was just buying whatever
not do my own analysis. Investment
names were discussed by peers. based on stock names from social media
or friends or television is not a strategy
for success. By this strategy, have you
learned anything?
Sold out very early post the market - Timing the market is not possible and is
movements in April 2009 (After the a random strategy for success.

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election results). From there on markets - Time in the markets is possible, and a
gave a very huge return for the next few definite strategy for success.
years. Many of my sold picks rose by 3-
10x.

(5) One advice you would like to give to younger people who have just started
earning toward the financial freedom journey.

Spend less, save more, start early, invest regularly, have discipline…all such advices
are there in tons from many social media influencers. These are simple to follow and
there is nothing more for me to add on this. This being simple, still many are not able
to make the cut. Why is it? That is where, I wish to give Two (Not one) advice. Both
are related to each other.

1. Do not Procrastinate: Everyone has all the information, tons of advice are
available from many social media influencers. Whatever you want to know or
learn is available in the internet. But still many do not “Act & Procrastinate”.
The more you delay, the more number of years of compounding you lose.
2. Make a Financial Plan: In our professional life, we make (or we are given)
project delivery plans, adhere to it and do everything needed to meet the dead
lines. Similarly, everyone needs to have a ‘Financial Plan’ from the month
they start earning and do everything needed to adhere to the plan.
(6) Can you tell us a bit more about your eBook on personal finance which has
received very good traction? What led you to create this book and what do you
think is the biggest mistake youngsters do in financial planning?

Background of work on Personal Finance…

I used to advise or guide new joiners in personal finance, whoever was interested. I
used to share small capsules of learnings over mail. The recipients would debate on
that topic with queries or sharing their personal views. The topics that you see in the
eBook were covered with a group of 10+ new joiners over a span of some 15-18
months. It was very randomly made with topics that group expressed interest to
know. The main encouragement for me was that most of them put the learnings to
actions or had a healthy discussion for learning more. Since most of the contents
were ready, I continued this initiative with another 3 circles for the next 2-3 years. A
glimpse of those emails below.

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I did have a thought, to share these learnings in an eBook. However, could not find
time to copy the contents from nearly 300+ emails. During December holidays last
year, I copied all contents to a word file. I put a lot of filler topics so that it was
coherent as an eBook. The next version of eBook is planned to be released in
January 2020.

Biggest mistake: Procrastination and not having a Financial Plan. Discussed in the
previous question.

(7) Some insights on your stock-picking process.

Below is a high-level overview with few pointers:

Investible Universe: Create a universe of stock names, which could come from any
one of the below

 Wealth Insight magazine by Value Research

 Holdings by Mutual Funds
 The products that I come across
 Something that is hitting the news frequently for good and bad reasons i.e. 3M
in the recent times.
 Running screeners – I sometimes run screeners based on some parameter(s)
that comes in mind
From these names, I spend an hour or two to glance at the annual report and quickly
check a few financial parameters in screeners to see if I am comfortable to add these
in my investible universe. A few parameters could be Debt levels, Growth in Book
Value, Earnings and Profit, Profitability ratios etc. At this point, it is NOT a buy.
Activities in this stage are more random and are done as and when I come across
names.

Complete Analysis: While the previous stage is random, this stage is more focussed
and dedicated covering the below activities:

 Data collection (Annual Reports, Previous call transcripts, competitor annual

reports)
 Financial Statement Analysis
o I run my own excel from the numbers in annual report rather than
referring online databases
o This I do to see how the individual numbers of various components i.e.
Capex, Finance cost, Inventory etc has moved in the last few years
 Accounting forensics
o Check for possible manipulation of numbers with a few models
o This and the previous activity “Financial Statement Analysis” go hand
in hand
 Study Annual Reports – a few years report of this company and report of a
few competitor companies

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  Competitive Analysis
o How this company stacks up in comparison to its competitor(s).
o Who is stronger? The company that I am analysing or the competitor
company?
 Management Analysis
o What were the earlier promises in Annual report and what was
achieved
o The tone when lower numbers are reported
o How efficiently are the retained earnings used?
 Opportunity Analysis – Size of the opportunity, growth rates that can be
expected and how many years would that growth sustain etc.
This analysis takes 6-8 weeks. I do all activities myself and hence take time. I also
do not hurry at this stage. Though the above are sequenced, I may go back and forth
based on requirement. As i complete, each activity above, I ask myself, “Am I
satisfactory?”. If am unclear or not satisfactory, I put that idea to hold or ignore
without further analysis, i.e. What use is analysing a company if the reported
numbers itself were under suspicion based from the models of “Accounting
Forensics”.

Valuation: If the above analysis is successful almost in all parameters, then valuation
is less important. But still do valuation to see where the current price stands. Infact
when all the above analysis is successful, there is some value that comes up in mind
(A kind of intuition), even without use of any valuation models.

After the above I may get a very few ideas a year, which are worth investment. I am
happy even with one good idea, that I am confident, I will invest over the next one or
two years. Adding new stocks to my portfolio happens only when it is outstandingly
great in comparison to other stocks in the current portfolio.

(8) With the current market conditions of bearishness, what do you think
should be done? How should people control their emotions?

A long-term investor would not time the markets. Since the investment horizon is for
several years. While you call it bearish, at the point of answering this question, the
index rose by 5% on a day and another 3% the following day. Once in a while,
market gives us sudden shocks and surprises.

Bearish is a relative idea. If you see the current value relative to May-June 2019
highs, it would appear bearish. But if you see the rock bottom values in October
2008, it appears market has increased by 4 times.

I would still not feel that market is bearish! Couple of months prior to election, the
market picked momentum pricing various factors (Mainly political) which continued
till the budget. Was this huge run justified? I see this only as a cooling phase after a
huge run. Of course, some economic indicators are not favourable signalling a

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slowdown. We as investors have no control over these things. We could control only
two things:

Our portfolio and emotions.

1) What can we do to our portfolio now?

 If the stocks in your portfolio are fundamentally good (I mean the
business fundamentals and not price actions), this down turn is a
welcome situation to buy more of those companies.
 If you are sitting on huge cash, such downturns are time to buy
truckloads of such stocks (This analogy of loading trucks was from one
of the interviews of Mr. Ramesh Damani).
 If you are not lucky to have cash to deploy, then the best strategy is
DO NOTHING.
 If the stocks in the portfolio are not having good fundamentals, just get
out of it immediately, irrespective of market conditions (Upward or
downward)
2) What can we do to our Emotions?
To the question of controlling emotions…There is not much action, as a long-
term investor who picks and invests in stocks with sound principles or a
framework is fully aware of the fact that prices do oscillate in either ways and
that their selling point is years apart. They do understand that it is a drain of
energy to panic on paper/notional losses, with selling point of that stock is few
years down the line. I can see this as three situations:

 If an investor has seen 2008 bottoms, and is continuing to invest till

now, they already have the needed emotional maturity.
 If an investor seen 2000 & 2008 bottom and has been continuing to
invest till now, then he/she must be a Zen.
 If an investor has been in markets in the last 2-3 years, then this
bottom does panic. Rather than controlling their emotions, they must
study their emotions and see within themselves. For a successful
investor to be successful, more than analysing and studying a
company, they must analyse and study their own behaviour and
emotions.
(9) What are your favourite books?

Wish to clear Three myths related to the question:

Myth 1 - Asking for one or top 3/ 5 best books: This is something difficult to answer
and a very hypothetical question. An Engineer or Doctor studies close to 50+
subjects in their 4-year curriculum. Reading one book or top 3 or 5 books do not
make them professionals. Every subject has an importance which they use at some
point in their career. Why would it be any different for an Investor? The learnings
related to investments do not come from one book or top 3 books.

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Myth 2 - “What were your best books/Read?” What is best for one will not be suitable
for others due to numerous differences in factors like (1) Interest on a concept, (2)
Requirement or expectation from a reading, (3) Previous knowledge level of the
subject and so on.

Myth 3 - Read a certain number of book/year or pages/day: You might read 20 books
a year, but if you only read and take no action, then that knowledge goes waste and
is also forgotten. Much better is even if you read one book, fully understand and
implement the learnings in your life and reap the benefits.

To answer your question of what my favourite books…

Books on Investing: Fortunately, way back in 2012, I started my investment learnings

from “Security Analysis” and “Intelligent Investor” followed by “Common Stocks and
Uncommon Profits”. The first two books would be a tough for anyone to understand if
there was no prior knowledge on investing or an accounting background. Having
read and understood these 2 books, further reading of other books was easy. I would
have read close to 40-50 books in my investment journey. However, these three
being the initial books are my favourite and regularly re-read it every year. Every
time, I read, there are new takeaways. My entire list of my readings can be seen in
this presentation.

Books on Investing (Indian Context): While the above two books gave many insights
about stock investing the two books by Shri. Parag Parikh gave me huge insights to
investing in Indian markets.

Books on Personal Finance: As told earlier, I was very passionate about personal
finance. However, the book “Rich Dad, Poor Dad” series of book by Robert Kiyosaki
gives new dimensions in Personal Finance.

Books on Soft Skills: To succeed in every aspect of life (not only in investing), certain
behaviour and soft skills are required. The earlier we learn, understand and cultivate
them in our personality, higher the benefits. Infact such books must be read first and
put the learnings to practise, before investment readings. One such book which had
a very great impact in my life was “The Success Principles” by Jack Canfield.

(10) What are your hobbies?

My childhood hobbies are collecting foreign stamps, coins and currencies, which I
continue even today and spend a few hours a year, in these collections.

(11) How did you increase your market knowledge?

 Most of the knowledge came from reading. There are around 40-50 books
that I have read.
 There are plenty of books and YouTube videos on investing.

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  Mere reading and not putting the learnings to action is of no use. I engaged
myself actively by - Making dedicated time, taking notes, see which points can
be implemented in my investment framework and implement those ideas.
 Every successful or failed idea teaches you something:
o A successful idea reinforces your existing learnings
o A failed idea needs you to look in to your framework and what went
wrong
 Have investment journal to record your learnings regularly. This over the
years will be a repository of knowledge.
(12) What are some steps/rules in money management you think goes a long
way to help the saver get the best out of his savings/investments?

Basic rule is Expenses < Income, only then can you think of savings/investment. This
is very simple rule, but a powerful one and unfortunately the most overlooked one as
well. Many do not appreciate the importance of this rule, much early in life.

I have come across people in two categories:

1) Category 1: Many people where Expenses > Income, can be debtors and
not savers/investors. By the time they realize the mistake, it could be
sometimes very late.
2) Category 2: There people are very less in number and their Expenses <
Income. They qualify to be savers/investors, but do not have a proper plan
and a framework. For this category to succeed, and make their financial
life best/big, a few rules are a must:
a. Have a proper financial plan with the minute details at least for the
next 5 years
b. Stick to the plan, whatever comes across – Do not procrastinate
c. Even before investing, focus on the below priorities
i. Plan for your short & long-term goals,
ii. Make the required insurances i.e. Term & Health
iii. Create emergency fund
No hurries to invest, before finishing such priorities

d. Whatever may be your investing asset class i.e. Stock, Real estate
etc, start with only after you have the sufficient knowledge.
Investing is a game of wealth creation. Understand the game well,
its rules, pitfalls, the knowledge, skillsets and various knacks to
succeed before starting the game.
e. It is very enticing to invest in equities. But first understand it well
and have a clear framework and strategy for your investments.
f. Do spend time and money on reading good books, listening to
successful investors, going to workshops etc. We want to be
successful in investing, but do not want to spend time or money in
that.

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Concluding Remarks:

Thanks to you for the patience in working with me for this interview. Good luck to all
investors.

All my part articles, notes and compilation of interviews can be taken from
https://www.linkedin.com/pulse/my-notes-compilation-value-investing-venkatesh-
jayaraman/

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 Tejas Khoday

Co-founder & CEO, FYERS

Twitter and Quora Infleuncer

About Him – I’d say I’m the type of guy who likes to take risks and try things which
are considered difficult to accomplish. When I was a kid, I didn’t have parents or any
mentors to guide me so I had to figure things out by myself. As a student, I was
known as the curious cat because I was always the one asking the most questions in
class. However, I was never a ranker as I considered studying for exams to be a
wasteful exercise and since I didn’t have anyone to report my performance to; I’d do
things my own way, make mistakes and learn from them. More often than not, I used
to bunk classes and spend more time in the libraries reading encyclopaedias and
political magazines. By 9th grade, I was sure that I will become an entrepreneur and
decided to study economics instead of science in high school. I have never looked
back since then.

It was my dream to study at the London School of Economics (LSE) but I could not
pursue it due to the lack of financial resources. I was disheartened at the time but I
moved on to complete my post-graduation in finance in India and then later started
working in the stock markets.

Investing Journey - At age 16, I was watching television and accidentally stumbled
upon CNBCTV18. I was fascinated by the ticker tape which showed the stock prices
of companies changing every moment. I was fixated by it and started trying to
understand how these things work. It became a strict routine to read a financial
newspaper everyday even though I didn’t understand most of the news. I didn’t have
any money to invest so I borrowed a little bit and opened a demat account to start
trading when I turned 18 years old. This was during the crazy bull run of 2006-07! In
my neighbourhood, I met with my friend’s dad who had invested his life savings in
stocks. That was inspiring to me. He advised me to invest in DLF IPO which was
supposed to be a big success. So yeah, that’s how I got started. I lived through the
exciting boom in 2006 and the bust in 2008 and the subsequent years. It had a
profound impact on the way I thought about everything.

More about Fyers and what led to founding it? What is your plan/vision for it?
(You were the youngest members of the exchange I believe) - I started my
career at a stockbroking firm, Zerodha in Bangalore and then went on to become an
oil & natural gas trader at Futures First, an MNC prop-trading firm which traded many
financial instruments ranging from commodities, currencies and interest rates
derivatives. I saw that there was a huge difference between the trading
infrastructures being offered abroad in comparison to India. I knew that the trading
experience in India has a long way to go. We decided to start a technology-focused
brokerage firm to try and bridge that gap. The goal is to provide a more robust and
useful trading platform for retail traders in India. The user’s expectations in our
market are years ahead of what brokers are currently providing. The vision is to give

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them what they’re really looking for and to implement it seamlessly.

Stockbroking is considered a grey haired profession. When I told people that I want
to apply for a NSE’s broking membership, everybody laughed at me because I was
only 24 years at the time and my younger brother; Yashas had just turned 20 and
was not even eligible to apply. Regardless of what anyone said, I had faith in myself
and our team. To our pleasant surprise, we were among the only few ones who were
granted the broking license that year and we went all in after that! It was the most
exciting and challenging endeavour.

Tell us about asset allocation and behavioural finance since you are working
in these aspects - Indians have a completely lopsided asset allocation as real-
estate dominates their share of assets followed by gold & silver in the form of
jewellery and then fixed deposits. None of these assets can help you become rich
barring real estate. But the problem with real-estate is that it is not liquid and the
price discovery mechanism is severely flawed which leaves the owners thinking that
their property value is more than it actually is. Monetizing real-estate is a lengthy and
cumbersome process. The opportunity to compound wealth lies in equities and that’s
something that needs to be looked at. To balance the asset mix, one may need to
increase investments to equities or reduce their real-estate holdings and re-allocate
to equities.

We often see that those who are involved in equity investing look at it from an
extremely short-term perspective. Making quick bucks is certainly satisfying but a
sizeable part of your portfolio should be aimed at long-term investing similar to the
timeframe in real-estate. It just requires effort and perseverance. The easiest thing to
say but the hardest thing to do is “Buy Low & Sell High”. As simple as it is, most
people find it very difficult because of the herd mind-set. If you can step out of the
herd and take contrarian steps, you’re on your way to becoming a rich person.

First stock you bought, first loss and what did u learn from it - I remember
buying Suzlon Energy. The idea that wind & solar energy would replace conventional
sources such as Coal was the most popular idea at the time. The IPO was
oversubscribed by 50 times and everyone was talking about the future of renewable
energy. In the midst of all the hype, the stock price imploded and I learnt some of my
first lessons in investing – Popularity does not equal to profitability. It was time to
start studying the financials before I ever think of investing in a stock.

Similarly, I had invested in Kouton’s retail. Since I didn’t understand how to study the
financials, I would read the Management & Discussions section of the Annual report.
I even visited their stores and thought that they were trying to cater to the mid-budget
segment who wants an upgrade from the unbranded clothing stores. It made sense! I
held on to the stock for a few years because they were expanding rapidly. Upon a
closer look, it became clear that they had borrowed too much and thus stuck with a
lot of loan repayments. I luckily got out early because in the years to come, they
went bankrupt. Lesson learnt: Anticipate the worst and move on. There is no need to
wait for the bad news to actually occur to take a decision even though it seems like
it’s too early to judge.

I had also invested in a few IPOs. My early experiences have helped me learn a lot

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partly because they were during important times of the boom & bust phase but also
because it was not my money that I had invested. So had to be double careful not to
lose it.

One advice u would like to give to younger people who have just started
earning/investing toward the financial freedom journey - To make money in the
stock markets; you will have to invest your time. Yes, it is important to spend time to
understand the market and make wise decisions. Most people want to become rich
by investing small sums of money through mutual fund SIPs during bull-runs. That is
probably the worst strategy. SIPs only make sense when the markets go down or are
in a range.

Other than that, I’d say one should stay true to the path. Wealth is not built overnight.
It takes time and efforts! Dedicating time to understand stocks and business is
essential to develop the conviction required for trading / investing. Casual investors
usually start in the peak bull markets and get flushed out the fastest during the end
phase of the cycle. Every phase of the market can be an opportunity depending on
your methods. A volatile market is essential for traders whereas a recession is a
good time for long-term investors. You must identify your strengths and stick to what
works the best for you.

Favourite books - My favourite book on stock markets is “Reminiscences of a Stock

Operator”. I have read it 3 times and I just can’t get enough of it. I recommend that
everyone who is interested to trade must read it. Other than that, the book that has
had the most influence on me is, “The Origin of Species”. Charles Darwin’s theory of
Evolution describes how the struggle for survival and natural selection determines
evolution and not the acts of god. One of my favourite quotes from the book is,
“Whilst man, however well-behaved, at best is but a monkey shaved!”

Your hobbies - Playing chess has been one of my favourite hobbies. Although I
never competed professionally, I managed to win the college championship. It’s a
fascinating game. Other than that, I enjoy following martial arts.

How do you increase your market knowledge - Read books, watch interviews,
take notes, do relevant courses / work at a broking firm. There is no substitute to
consistent work.

What are the basic metrics you look at a business when you are valuing or
looking at it to invest?
According to me, any company’s success largely depends on the quality of the
promoters & founding team. That’s the first thing one should look at in my opinion.
Everything else is next.

Any example where patience has paid off for you.

Stockbroking being one of the most regulated businesses in India, patience in
dealing with the regulator, exchanges and depositories has certainly helped us.
When you’re young and hungry, only patience can help you avoid doing stupid
things. Luckily, I believe I possess enough patience to be able to operate in the
capital market ecosystem. One has to be mature and accept that it is a journey and

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not a destination.

Who is your role model in investing?

I was influenced very early by George Soros, Stanley Druckenmiller & Paul Tudor
Jones. I was very interested in becoming a hedge fund manager with a macro
approach but then I realized it requires much more than just an inquisitive mind.

Disruptions - What do u think of them and how do u see if a business you are
looking as a prospective investment won’t get disrupted easily?
Currently I’m an entrepreneur and I haven’t invested in anything else other than
myself and my team. I think as a generation, we get very fascinated by the term
“Disruption”. The ability to adapt is more important than trying avoid disruption in my
opinion. I have observed that that many startups are focused on disruption to such
an extent that they forget that making money is important.

So many quotes from Mr Warren Buffet and Peter Lynch , any quotes that
didn't work for you?
They all work for me. I love reading their quotes.

When do u sell a stock? What is the criteria according to your rationale that a
stock has reached its life? When do you know it’s time to get out of a stock?
From my memories of 2006/07, it is always best to sell a stock when every noob is
talking about why a stock should go up and has a solid reason to back it up. I have
been in that environment more than once and we all know what happened next. The
market is an information discounting mechanism. If everyone expects something,
then it is already in the price.

In your investing journey - one thing u did which you think you did great and
one thing u regret doing?

Betting everything on stockbroking was probably a good thing but time will tell. I do
regret trading with very high leverage and losing money even though the direction of
the trade was right. I guess everyone has to go through it at some point during their
trading career. The earlier, the better.

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 Dr. Sagar RV

Twitter Influencer

Youtuber and Eductor

My Name is Sagar RV and I have a Youtube channel where I talk about the stock
market. I have a MBBS degree but I decided to become a full time investor once I
finished my degree.

When I was in med school, I started 7 different businesses as part time jobs and
made sure each one of them profitable. Every time I started a business, I realized I
wasn't able to scale it and the upside was limited so I would take the profits and
invest in another business and make that one grow. I kept doing this for 5 years until
I had around 4 lakh rupees of savings.

In my 5th year I knew I wouldn't have enough time for part time job because the
exams were going to be very hard so I decided to invest that money. My first stock
was Apple and I decided to invest without doing any research. The stock fell 20% in
the first 3 months but it did recover and I made around 10,000 Rs from it. This wasn't
a smart decision because if I wouldn't have sold that position, I would have made
more than 1.5 lakh rupees in my account. Funny thing is that when I was selling this
stock, Warren Buffett was buying this stock. I guess he really knew the value of this
stock and I never did.

Until the moment, I hadn’t experienced any losses because I usually don't sell
stocks. So , the second stock I bought , I still haven't sold it because I really like the
company so I can only comment on this after some time but I'm sure I will have some
losses in the future. I hope this happens after a very long time :)

The only advice I can give is that read and learn as much as you can for free. People
think you have to pay to learn but the truth is I learnt everything for free. All the
investing books I have read are available online and you will be surprised by all the
information you can find online. The issue is what happens once you read
everything. People believe everything they read and this is a mistake. The best thing
you can do is question everything you read and develop your own thinking. This will
help you in stocks and everything else as well.

My favourite book is Poor Charlie's Almanack because it talks about life, psychology
and stock market. A book only about the stock market can be bit boring sometimes
so this one is very entertaining :)

At the moment , I don't have much time for hobbies because I spend all my free time
making Youtube videos and I also like to help my course clients but my favourite
hobby is photography. I guess that helps me make better Youtube videos as well.

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 Dinesh Sairam

Twitter, Quora and Value Pickr Influencer

Blogger at Valuationinmotion.com

I have been always been fascinated by finance and started investing as early as
when I was still in college. I also invested throughout my MBA, saving up pocket
money. Today, while I work as a Risk Analyst for Investment Banks, I continue to
invest with a 100% asset allocation to Equities (And Bonds every now and then).

I admire every step in the process of investing, but more so the final component,
valuation. I have taken a particular liking to valuing companies because every case
is different and with each valuation, I understand a little bit more about the puzzle
that is 'value'.

Investing Journey - Back in 2013, I was travelling to Chennai on a train to participate

in an investing conclave. Mind you, this was purely to score those extra cookie points
in external marks for my Commerce Undergraduation. While on the train, I was
reading up on the topics of the conclave and the person sitting next to me asked me
about it. It turned out he was actually a trader and an investor for 20+ years based
out of Mumbai. We had a good, long conversation. I had my first stock
recommendation that day: Britannia Industries. I remember asking my dad into
purchasing token quantities of shares in the company. That was my first official
Equity investment decision (Based on a stock tip, nevertheless). Since then the stock
has made a 10x.

Fast forward to 2016, I picked the 'Finance' major in my MBA (In fact, all my 10
electives in MBA were on Finance). This was when I considered investing as a habit,
thanks to all the understanding my education gave me about Equities and
investments. Also, I had just learned about Warren Buffett and his letters back then.

So my initial strategy was to do Cigar Butt investing. Thanks to the bull market back
then, I made considerable gains (In 2016, my IRR was 333% - yes, I'm not making
that up). But slowly, as Charlie Munger made Warren Buffett realize that Cigar Butt
doesn't scale, I realized what I was doing was indeed stupid. So I started selling my
stocks in tranches all through 2017. At the end of it, I only held HDFC Bank in my
portfolio. I call 2017 my 'lost year'. I did a lot of reading, researching and self-
introspection. By 2018, I had come up with an investing code-of-conduct, a valuation
model and a new outlook how wealth is created. So in a way, 2018-19 is when I
actually started my "investing journey" (Yes, I'm relatively brand new to the markets).

Apart from the dubious claim of Britannia as my first purchase, the first very
transaction in my own Demat account was in a little-known IT company called
'COSYN'. See, I had just finished building an impromptu valuation model. I happened
to see this company being recommended in some anonymous blog post. I picked it
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up and valued it based solely on historical numbers, without any context of the
business and its future plans. Essentially I was still embarrassingly naive to have
purchased the stock based on the "undervaluation" based on numbers alone.
Thanks to market optimism, I made 5x in 6 months. But to this day I would happily
admit that that was my worst investment mistake - investing based on anonymous
recommendations and extrapolation of historical numbers without any context of the
business itself.

My first big loss came in Mirza International - about 40% from my average price. My
investment thesis was based on the assumption that the management will focus
more on furthering the footwear business, because I believed (I still do) that the
footwear industry has a massive opportunity size in India. Unfortunately, the
management had other plans. They invested heavily in their retailing business and
co-branded it with their 'Red Tap' brand. I don't mind companies experimenting new
businesses - in fact, I encourage it. But the capital commitment is key. In this case, it
was heavy and they were running head first into an industry which already had crazy
amounts of competition. I sold the shares a few weeks after I decided against the
management's commitment to what I felt was the wrong business. The company is
still into retail and I wish them success, but for me the risks simply far outweighed
the rewards. The lesson here is that regardless of your level of preparedness or
financial acumen, you can still be blindsided. Equities offer rewards for a given
amount of risk. If we expect to earn good returns, we should expect to take good
risks. In my eyes at the time of sale, Mirza International was a bad risk to take.

One advice u would like to give to younger people who have just started earning
toward the financial freedom journey - Save, save, save. Creating wealth is relatively
easy. Keeping it is very difficult. Spend on things that are necessary and spend on
things that make you happy (Remember, pleasure and happiness are not always the
same). Every other dime you spend is a financial crime you commit on yourself.

Favourite Books - It's difficult to pick favourites, but just for the sake of the question,
let me pick 5

a) "Competitive Strategy" by Michael Porter

b) "Security Analysis" by Ben Graham and David Dodd
c) "The Model Thinker" by Scott E. Page
d) "Poor Charlie's Almanack" by Charlie Munger
e) "Principles" by Ray Dalio

Apart from the books, Warren Buffett's letters are a timeless classic. I have them
printed and bound.

An interesting titbit: I moonlight as a poet and have been published in the book "Best
Indian Poetry (2018)". I love watching Science, Psychology and Philosophy videos
on YouTube. Reading books on my Kindle is always a staple. In another life, I was
also a State-level Chess player.

How do you increase your market knowledge? - Compared to just a few years back,
we have an abundance of information, thanks to the internet. One can choose to

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read, watch or listen to gain knowledge on most topics today. So I learn in any way I
can about the topics I find interesting.

But it's important to differentiate between expiring knowledge and lasting knowledge.
Learning about the inner workings of the auto industry, for instance, creates lasting
knowledge. Reading up on research reports, technical calls or rumours about
specific auto stocks creates expiring knowledge. So, just as junk food destroys your
body, junk or fast expiring information dumbs down a person. We should make it a
habit to learn a lot, but more importantly, to learn worthwhile.

What are the basic metrics you look at a business when you are valuing or
looking at it to invest?

In my head, 'Value' is largley made up of 6 components: Growth (i.e. Sales Growth),

Margins, Reinvestment, Risk, Redundant Assets (Patent, "Land Bank") and
Competitive Advantage Period ("Moat"). So I look at all of these in comparison to the
industry average and proceed from there.

Any example where patience has paid off for you.

It's too early to tell. I have been an investor for only 3+ years. Within that, I've
invested big money only for 1.5+ years. But I suppose one example could be Ion
Exchange. Ion Exchange was one of my earliest picks. For 2.5+ years, the stock
went nowhere. In many forums, I was getting 'advice' left and right that I was
investing in a mediocre business. But recently, Ion Exchange doubled in value. The
Government of India has just started looking at water treatment as a policy measure.
So, I still believe the company has a long future ahead.

Who is your role model in investing?

Nobody specifically. I love gathering knowledge from several places. Everyone

ranging from Warren Buffett to Vijay Kedia have contributed something to my
investment knowledge and I am forever grateful for it. But if I definitely had to pick
out someone, I would say Warren Buffett.

Disruptions - What do u think of them and how do u see if a business you are
looking as a prospective investment won’t get disrupted easily?

I believe the word 'disruption' has been absued a lot in recent days. Regardless of
whether disruption is becoming more prominent or not, the trick is to always pick out
a business that has a very slow rate of change. In other words, look out for
businessess that don't necessarily change with time. As Warren Buffett once said:
"Our approach is very much profiting from lack of change rather than from change.
With Wrigley chewing gum, it's the lack of change that appeals to me. I don't think it

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is going to be hurt by the Internet. That's the kind of business I like."

So many quotes from Mr Warren Buffet and Peter Lynch , any quotes that
didn't work for you?

I wouldn't point out to any specific quote, but there's a general misunderstanding of
many Warren Buffett quotes. For instance, his most famous one, "Our favorite
holding period is forever" is probably the most misused investing quote out there.
The complete quote comes from the 1988 Berkshire Hathaway Chairman's Letter to
Shareholders: "In 1988 we made major purchases of Federal Home Loan Mortgage
Pfd. (“Freddie Mac”) and Coca Cola. We expect to hold these securities for a long
time. In fact, when we own portions of outstanding businesses with outstanding
managements, our favorite holding period is forever."

Yet people continue to quote Mr. Buffett to justify their "buy and hold forever"
strategy. Funnily, Warren Buffett himself sold Freddie Mac (One of his 'forever'
companies) along the way. Mr. Buffett often dumbs down the investment advice he
gives out. So a great way to learn from Warren Buffett is to look at what he does, not
what he says.

When do u sell a stock? What is the criteria according to your rationale that a
stock has reached its life? When do you know it’s time to get out of a stock?

There could be broadly 3 reasons to sell a stock:

1. The fundamentals of the company has changed

2. The stock is overvalued and/or you can find a better investment with similar or
better fundamentals
3. The story you imagined for the company isn't playing out as you envisioned (In
fact, more problematic if it is taking a completely different path)

#1 and #2 are the most prominent. #3 requires you do to more research to find out if
you are still comfortable holding the stock.

In your investing journey - one thing u did which you think you did great and
one thing u regret doing?

The best thing I did was read up on several Valuation lessons, videos and blog posts
written by Prof. Aswath Damodaran. While the academic learning was great, the
more important thing to me was that it gave me a whole new way of looking at the
value of companies and the components involved. Earlier, I used to do fundamental
analysis with a broad brush stroke. But these days, I look at companies in different
cross-sections of Growth, Risk etc as mentioned earlier.

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The worst thing I did was investing based on stock tips and random blog posts.
Thanks to the bull market back then, I ended up making a good amount of returns.
But looking back, I am ashamed at how stupid I was back then. Thankfully, those
days are behind me and I hope to never repeat this behavior again.

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 Arun Kumar

Blogger at eightytwentyinvestor.com

Head of Research, Funds India | Seasoned Markets Professional

I am Arun Kumar and I started my career with a wealth management firm in 2011,
where I was a part of the mutual fund research team. Gradually, I moved on to
developing various frameworks for asset allocation models and also started building
asset allocation based solutions. Post that, I also had the opportunity to build a
digital advisory platform entirely from scratch, which automated the whole investment
process starting from profiling the risk, building a new portfolio and reviewing the
existing portfolio.

As I started getting exposure to different aspects of wealth management, I realized

there was a huge gap in terms of investment advice that was currently being
provided. I started a blog called EightyTwentyInvestor in 2016 with the intent of
sharing all that I learnt from my experience, interactions with smart investors and my
mistakes. Most of my investment frameworks are explained in the blog.

Recently I have joined India's largest online investment platform FundsIndia as their
Head of Research for Mutual Funds.

How did you start your investing/trading journey - In 2007, I worked as a

software engineer in Kolkata for two years after my engineering. One of my
roommate's father was a popular investor and he had written several books on how
to invest in the stock markets.

My friend introduced me to the world of stock markets and I slowly started to read all
his father's books. I found the whole field fascinating and the bull market frenzy at
that point in time added to the excitement. For the first few months I was just
analysing from the outside but as I saw most of the stocks going up, borrowed some
money from my mother and entered at the fag end of 2007!

You would have guessed the rest of the story. My money halved in a few months
and I decided not to get back in ever without proper understanding of the markets.

Eventually I went on to do my MBA and joined a wealth management firm where I

learnt about the basic building blocks of investing and the nuances involved. I
realized that successful investing had a lot to do with psychology more than
intelligence.

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Tell us about asset allocation and behavioural finance since you are working
in these aspects

In your early part of investment journey, don't worry too much about asset allocation.
Your ability to earn and save has a far bigger long term impact. Just maintain a high
savings rate and high equity allocation. As your portfolio size increases vis-a-vis your
yearly saving, Asset allocation becomes more relevant.

If your time frame is less than 5 years, your asset allocation has to be predominantly
fixed income oriented.

If you have a time frame more than 5 years, then you will have to decide on your
asset allocation. A higher allocation to equities usually has provided high inflation
beating returns over the long run. But equities remain extremely volatile in the short
run with sharp declines and upsides being a common occurrence. Not everyone can
handle the degree of short term declines though the long term possibility of better
returns is higher. So asset allocation is simply deciding on the mix of debt and equity
(more asset classes can be used based on your requirements) which can let you
decide on the right trade-off between the short term declines and long term returns.

Once this is decided, the asset allocation can also be adjusted based on market
cycles. Markets move in 4 stages - Bull, Bubble, Bear, and Deep Value. In a bubble
zone we will need to cut risk via lower equity allocation and in the deep value zone
we will need to increase equity allocation.

One advice u would like to give to younger people who have just started
earning/investing toward the financial freedom journey

When you are starting just get the one time decisions out of the way first. Build an
emergency fund to cover 6 months of spending via a simple liquid fund. Next is to
get both life and health insurance done. While earlier the better, most of us get
serious about insuring ourselves only after we get married and have our first kid.

Once you are done with the above three, find out your short term goals for which you
will need money in the next 5 years. This portfolio has to
fixed income heavy as the time horizon is short. If the goal is not too critical and can
be postponed, you can add some bit of equities but cap it at 30% of the portfolio.

For longer term goals, just start off with a simple, equity heavy portfolio of 3-4 funds.
Since you have enough time, try to have more than 70% in equities upto 100%
based on your tolerance for near term declines.

The key to remember is that in your early stages, your additional savings every year
is far more than your portfolio returns. Your savings rate will have a far higher impact
than your actual portfolio returns till the time your portfolio become large in size. So
target a savings rate which is at least more than 30% of your monthly salary. And
the best way to get disciplined about this is to automate the whole thing via an SIP.

Page | 28
With the current market conditions of bearishness, what do you think should
be done? How should people control their emotions?

It's very difficult to control emotions in the middle of a market fall. The starting point is
to accept that equity markets will witness near term declines almost every year.
Going by history, you should be ok to accept upto a 25-30% fall in the next 6 months
as normal. And once in a decade, you should be prepared to see a far bigger crash
of 50-60%. If this is not comfortable for you, then you need to lower the near term
decline by adding more debt. The trade-off is that in the long run, your returns will
also be lower compared to a pure equity portfolio.

The key is to decide on an asset allocation which helps you take an acceptable trade
off when it comes to near term declines vs long term returns.

My suggestion to handle a market fall

1. The first thing to decide is whether you can predict or not. Historically there
is no evidence of anyone being able to predict the markets consistently.
Since predictions are tough, I prefer taking a humbler approach of preparing
for the worst.
2. The 10% to 20% fall period is the most dangerous. Because your intuition
that the bad news would lead to further correction has come right. You
predicted. And it came right. This is where the lure to predict a further fall
and to move out of equities is the highest.
3. Since it's extremely difficult to think straight in the middle of a market fall, I
prefer to pre-load the decisions. Come up with an "If-Then" plan.
o If markets fall 10%, I will..
o If markets fall 20%, I will..
o If markets fall 30%, I will..
o If markets fall 40%, I will..
o If markets fall 50%, I will..
4. Have an emergency fund, which will ensure you don't need to touch your
equity portfolio for any sudden money requirements.
5. A tip from stoic philosophers - Mentally write off 50% of your equity portfolio
value and imagine what impact it would have on you.

Favorite books - I usually prefer to read outside investing and these are some of the
books I really enjoyed.

 Black Box Thinking - Mathew Syed

 Atomic Habits - James Clear
 Switch, Made to Stick, Decisive by Dan Heath and Chip Heath
 Hooked - Nir Eyal
 Adaptive Markets - Andrew Lo

Hobbies - I love watching movies and playing badminton.

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How do you increase your market knowledge?

Mostly it is through reading. The internet has democratised access to some of the
best minds in the world and the good part is most of them are available free of cost. I
usually watch the lecture of authors on youtube and read book summaries before I
purchase the book. This works as a good hack for me to get the core idea and most
of the time I can avoid the actual book if the idea is already clear.

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 Raghav Behani

Founder of Alphamultiple Advisors, A SEBI Registerd

Equity Research and Consultancy firm

Author of an Investing starters handbook

I am a Chartered Accountant and did my articleship from Deloitte Haskins & Sells,
where I got the exposure to the audit of listed companies.

Investing Journey - When I was a child, I used to go to Kolkata for my summer

holidays. My Maternal Grandfather used to ask me to update him with the latest
stock prices and the price movement every minute fascinated me, he would explain
me how the prices moved but at that age I didn't grasp much. I would read
newspaper diligently in my school days and in 2007-2008 there was a lot
of excitement because of the volatility and I used to track stock prices just because
of the buzz around stocks. Later I took part in the Hunt for India's Smart Investor on
Zee Business and won it despite being the youngest participant.

First loss and learnings - My first stocks were Sonata Software and Cranex. I bought
Sonata Software based on my own research and understanding of financials (I was a
commerce student) and Cranex on the recommendation of some tipster on an online
forum. I sold Sonata Software at double my purchase price over couple of years
while Cranex crashed by 50% in a few weeks. I learnt a lesson to rely on my own
research and conviction for making any investments.

One advice u would like to give to younger people who have just started earning
toward the financial freedom journey - Start an SIP and buy a term insurance cover.
Use the 80C limit to the maximum possible extent. Direct equity investments should
be a small part of your overall portfolio in the first five years of your investing journey.
Make a habit of writing down why you own a stock and keep updating yourself with
the performance of the companies. At any time you should know the turnover and
profits of your investments. Your first few years will be full of trial and errors and you
will have to discover your investment style.

With the current market conditions of bearishness, what do you think should be
done? How should people control their emotions? - Continue your SIPs in mutual
funds, analyse the reason why you lost money in stocks. It may be quality, valuations
or the expectation of making a quick buck from the smallcap rally of 2017. Treat this
as a learning phase and get this straight into your mind, no matter how great an
investor you are, your portfolio will correct by more than 30% multiple times in your
investment journey. Markets are dynamic and we are always evolving and learning.
Bear markets are the best teachers and make you a better investor. However, you
need to be bullish on the long term prospects of the stock markets in India if you are
a long term investor.

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Favourite Books - Cold Steel by Tim Bouquet and Byron Ousey, One up on wall
street by Peter Lynch and Land of the seven rivers by Sanjeev Sanyal.

My hobbies include Long drives, listening to old songs and reading non-fiction books.

To increase my market knowledge, I read as many annual reports and concall

transcripts that I can. I read atleast 2 business newspapers every day.

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 Prateek Goel

Investor since 13 years | Started at a very young age of 17

Working in Energy Startup | Blogger at Investeek.com

I am Prateek; 31 years old and working in energy start up in Atlanta, USA. I enjoy
hiking, learning new things and making people around me smile. I am married to a
beautiful wife and also have a dog. Fun fact about me - I started driving a car when I
was 13 years old!

Investing journey –

I started investing in 2006 when I was 17 years old, as my grandfather wanted to

invest and he was not very computer savvy so he made me invest on his behalf. I
got hooked to investing then.

I was very immature and naive when it came to investing. I used to make some
profits and I thought it is so easy to make money, why do people in this world keep
complaining about money!! I used to do intraday trading without stop loss; I used to
buy stocks that I had no clue about. It was hit or miss, I was purely gambling. I learnt
it the hard way when I lost a LOT of money in some intraday trades. I had a
relationship manager at a leading brokerage company and he used to laugh at my
trades. Now that I think about it, he could have probably done a better job and asked
me not to do such trades.

Anyway, I stopped intraday and started investing in quality stocks. One "quality"
stock I invested was in Punj Lloyd. It was one of the leading EPC companies at that
time, everyone used to say it is the next L&T. I bought it around 500 rupees and sold
around 25.So not that quality after all. I made some profits too, I made a lot of money
in Infosys and IFCI - these two I can remember but there were more.

First loss and learnings -

I don’t remember the first stock I bought but the first loss was probably on intraday
trades - SAIL was a big one. I stopped intraday !!!

The biggest learning in my life with respect to investing has been the 2008-09 crash.
I was at my peak before the 2008 crash, my portfolio was giving unimaginable
returns and it all crashed. Punj LLoyd went from 500 to 25 in few months, a lot of my
stocks I sold at 50-60% loss. I know the markets will rise again but I needed the
money and was forced to sell at a loss. However, that loss has made me what I am
today, I learnt fundamental analysis of stocks, and I stopped buying stocks just
because I "Felt" good about them. I start studying stocks like books. I read all about
the business, the macroeconomic factors, and the government policies. Through
learning about stocks, I learnt a lot about economics and businesses.

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One advice u would like to give to younger people who have just started earning
toward the financial freedom journey -

Don’t get scared of the markets. I have made so many losses but I have learnt the
most from my mistakes. I have learnt to have patience and not get bothered by daily
and weekly swings. Learn about a business before you buy one. If you had to bet
your life savings on this business, would you still buy it?

I always suggest, invest by yourself. You learn so much about business and
economics if you do your own investments. Also read keep reading. Not necessarily
books, but whatever you can read. Because I made immense losses early in my
investing and recovered, learnt and came back strong, I was able to invest enough
over 5-7 years to save for my wedding expenses, down payment of a house etc. I
want more Indians to invest and not feel afraid to invest. That is why my wife and I
started www.investeek.com - Just to impart more knowledge, create awareness and
enable more Indian Millennials to invest.

Favorite books -

I am not a very big books person, but I read news and article a lot. I read atleast 10-
20 articles a day on various topics of finance, politics, business, economics etc.

Your hobbies -

I love to travel, hike and cook food! I love to read about what is going on in this
world and if you want to become a good investor, you need to stay updated with
what is happening in the world as well as what is happening in the local economy

How do you increase your market knowledge? -

Some of the websites I use to stay up-to-date is moneycontrol.com, screener.in, ET

Wealth, Bloomberg etc. If you can read everything that money control publishes, that
will give you enough knowledge to know what to do!

Economic times is also a really good learning tool. Morningstar is another one... and
then of course somewhere hidden in all these is our website Investeek. We try to
provide all the resources that will enable you to start investing. Last but not the least;
I follow some great people on twitter. I read articles shared by them as well.

What are the basic metrics you look at a business when you are valuing or looking at
it to invest?

I look at growing revenues, reducing debt, promoter holding, return on capital,

expenses and where are they going, new launches, new products etc. I don’t look at
profitability too seriously as some businesses take time to get profitable.

Any example where patience has paid off for you.

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Sanwaria agro - held it for over 2 year without returns to get 4x return in 60 days

When do u sell a stock? What is the criteria according to your rationale that a stock
has reached its life? When do you know it’s time to get out of a stock?

I sell a stock when I accept I made a mistake in buying it or when it gives me atleast
2x returns.

In your investing journey - one thing u did which you think you did great and one
thing u regret doing?

I think I have done a really good job at identifying growth stocks before it reflected in
the share price. For example IOL chemicals, Gravita India, Bhansali Engineering,
NELCO, Sanwaria Agro to name a few.

What led you to choose India Markets over the US markets since you are in the US.
Which other markets you like in addition to India, and what are some issues u see in
Indian market?

I chose indian markets because I believe there is HUGE potential for growth and re
ratings that will occur in the next few years. I like the US markets as well. Some
issues I see in the Indian markets right now are all temporary and the markets will
bounce back sooner than later.

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Hello Reader Thanks for Reading!

Stock Markets can be confusing for beginners and just like a parent would hold his child’s
hand, a hand holding is required in initial phases. You know what they say “You can't build a
great building on a weak foundation.”

That was the reason why in this second E-book of stocksandbiceps.com, we brought to you 9
Ace personalities from the Financial World who will guide you through the simple maze of
Investing.

I hope you took some takeaways from stories and their losses!

Publication of - Follow us on -

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