Tuesday, August 15, 2006

Investing as an obsession...

- Carlos Castaneda

Success isn't something you chase. It's something you have to put forth the effort for constantly. Then maybe it'll come when you least expect it. Most people don't understand that.
-- Michael Jordan

The one below summarises everything i believe in -

“Yeah. Well, of course, we get these questions from a lot of the enterprising young. And its a very intelligent question. You look at an old guy who’s rich and you say, “How can I become like you, except faster?” [Audience cracks up.] And my answer would be that I did it slowly - inch by inch - insight by insight - by grinding away, patiently accumulating, taking losses when they occurred, etc., and if you’re looking to do it with vast rapidity, you’re talking to the wrong man.
I know it works my way. And you’ve got to do something during the initial years anyway. You don’t want to just play tiddlywinks. So I say welcome to the pool of you want to come and spend each day trying to become a little wiser than when you were when you got up in the morning and keep reaching for responsibility and reaching for the ability to discharge your duties faithfully and well. That way, step by step, you get ahead.
But you don’t necessarily get ahead in nice, neat, little increments. The getting ahead comes in spurts. But you’re preparing for those spurts by discipline, day by day, over long periods.
And one of the things you have to learn is not to go crazy when you’re in the midst or on the top of a big spurt - because a lot of people do. You may not need Zsa Zsa Gabor or a Lamborghini or a whole lot of other things that you may think you’d like to have now.
But slugging it out and inch at a time, day after day, that’s my way.” - Munger

I keep away from the stock market gyrations of everyday by concentrating on other activities that i like for example books, my job and women. I firmly believe that in order to exploit other people's nature as conditioned by centuries of evolution I have to divest myself from many activities that any "player" in the stock market would be intensely involved in.

So, I have a few thumb rules that i follow on most occasions.

But, sometimes the situation calls for extreme opprtunism, and then one has to whip himself into focussed and purposeful action. The catch is "focussed" and "purposeful", something which is absent from day to day activities of most human beings.

More Later...

Monday, August 14, 2006

A Few Links...

Listed below are a few links that i visit regularly ....

Stock research -
  • www.moneypore.com
  • www.valuenotes.com
  • http://in.finance.yahoo.com
  • http://sebiedifar.nic.in/
Blogs/Websites -
  • http://arpitranka.blogspot.com/
  • http://dahhuilaudavid.blogspot.com/
  • http://www.sanjbak.com/
  • http://mikesnewsletterinvesting.blogspot.com/
  • http://dardashti.blogspot.com/
  • http://kyleschnare.blogspot.com/
  • http://futile.free.fr/

Sunday, August 13, 2006

I Love Books...

My love affair with books has been on for a long time now. I have a negative power in both my eyes. And to imagine that I am the only person in my entire extended family to have weak eyesight. But it has been worth it. Even in MDI, I was happier in the company of a good book than another fellow homo sapien.

I feel that I am ill-equipped to take decisions optimally in comparison to a person with my level of intelligence but more experience in life. Different books (Apart from the Value Investing ones) take care of different gaps in my thought process. I believe strongly in Murphy’s Law, so my sole intention is to avoid mistakes while reaching decisions so as to negate my downside risk as much as possible

Friday, August 11, 2006

What Growth means...

Picture this...

Two friends talking to each other about the common Admission Test.....let's call these friends A and B...

A - Dude, the Cat is easier to bell now.....
B - What.....How dude, All my friends tell me that....But i cannot get the logic behind the statement...
A - Dude, y' know, The IIMs have incresed the number of seats....it will be easier to get in now....
B - Wow !!!, Way to go man....y' know, I hadnt thought of that....
A - And that's the reason you won't get in and I will , y' know, Dude

And laughter all around.......

Now this is not entirely correct. The fact is that the level of CAT i.e getting through a top 10 business school is actually growing proportionately with any number of seat hikes etc etc.

My guess is that it might even be getting tougher....

REASON - The number of people giving the exam is increasing stupid....

This above analogy is wholly lost on most individual investors. they mistake growth in financial numbers as growth without taking into account the amount of investment that went into bringing about these numbers....

According to Buffett - " The business is wondeful if it gives you more and more money every year without putting up anything, or by putting up very little. And we have some businesses like that. A business is also wonderful if it TAKES money, but where the rate at which you re-invest the money is very satisfactory. The WORST business of all is the one that grows a lot, where you'd forced to grow just to STAY IN THE GAME at all and where you're re-investing the capital at a very LOW rate of return"

My point being, the fact that investors should look for is that whether the business is able to grow it's financial numbers like sales, revenue without any substantial investment of capital back into the business by the owners.

Saturday, August 05, 2006

A few of my favourite books...

In No Particular Order -
  • Irrational Exuberance - Robert Shiller
  • The Prince - Machiavelli
  • Genome - Matt Ridley
  • The last playboy - Shawn Levy
  • One up on Wall Street - Peter Lynch
  • Buffet The making of an American Capitalist - Roger Lowenstein
  • Guns, Germs and Steel - Jared Diamond
  • Intelligent Investor - Graham
  • Security Analysis - Graham and Dodd
  • Fooled by Randomness - Taleb
  • A Mathematician plays the Stock Market - Paulos
  • The Count of Monte Cristo - Dumas
  • Tactics The art of Success - DeBono