I did my first transaction in equities in the year 1979. I was in 12th standard, Clive Loyd had not yet won the ‘Prudential Cup’ ….and my parents did not think that a ‘kid’ should not deal in shares…I think my first transaction was 50 shares of Ind Suzuki (later on called TVS Suzuki). Do not remember too much more of the details – but the ‘broker’ remains the same.
Well it was a long time ago – my head was full of black hair, felt invincible and of course foolish ideas were dime a dozen!
Beating the market was so easy – if you did not measure you will anyway not know, correct? So used to be happy with some short term gains…then started trading/ investing for my dad, mom, dad’s Huf, sister.
Well like all journeys learning starts only when you admit your ignorance – is it actually the beginning of wisdom?
Some important learning over the years have been:
– In the medium to long term equity markets do well. In the short term, they are just wild – and let this not scare you.
– Good quality equities tend to do well, but predicting WHEN (market timing) is neither possible, feasible NOR NECESSARY.
To make money you need to invest in good quality of equity – shit does not change form! I have lost capital ONLY in poor quality stocks – but I have also made money. I continue to deal in shares like H K Finechem, Moschip, Crest Animation(in the green), Arvind trading, Punj Lloyd, Taneja Aerospace (made money, yuck!), Allied Digital, Jupiter Bio, ……..etc. Apart from losing my capital in Shaan interwell, Indiana Dairy, and Krishna Filaments!
The last 9-10 years have been just TOO GREAT…I do not expect the next 10 years to give such an excellent return. And to think my broker has helped me beat the 10 year sensex performance by a mile, is as scary as it is satisfying.
-Expect your portfolio to double in say 6-7 years, especially if YOU ARE NOT REINVESTING THE DIVIDENDS. Anything shorter is good luck.I know people who are traders, investors, fund managers, CIOs, research people – almost none of them can predict the closing index – in the morning. My respect for them has only increased! Short term trading and long term investing are like ‘lightning’ and ‘lightning bug’ – there is no connection AT ALL.
Still, nearly all investors think they are smart enough to define such short-term movements, and make money.
This is hubris – and as expected frequently gets them into trouble.”
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