For those who can't make it, I'm live-tweeting my insights from the @ias_summit talk with @jeevanpatwa
So let's begin -
So let's begin -
There are ten commandments of investing that @jeevanpatwa stands by -
These commandments have helped him generate supernormal returns over his professional career. So let's understand them.
These commandments have helped him generate supernormal returns over his professional career. So let's understand them.
1 - Right business at the right price is paramount.
Valuation and earnings growth are the two drivers.
Entry price decides your final returns.
Valuation and earnings growth are the two drivers.
Entry price decides your final returns.
2 - Business understanding is a virtue
Business understanding builds conviction, conviction builds patience.
This helps you understand the growth ahead and the sustainable competitive advantage.
Business understanding builds conviction, conviction builds patience.
This helps you understand the growth ahead and the sustainable competitive advantage.
3 - Sustainable RoCE and Growth create wealth.
-> Size of opportunity drives growth.
-> Sustainable moat drives RoCE.
If you get a handle on these, a large part of your investment process is sorted.
-> Size of opportunity drives growth.
-> Sustainable moat drives RoCE.
If you get a handle on these, a large part of your investment process is sorted.
4 - Your portfolio must reflect your thought process
Many people talk a long term investment game, but do just the opposite.
Picking a portfolio process and sticking to it is important.
Of course, one can pivot, but not everyday.
Many people talk a long term investment game, but do just the opposite.
Picking a portfolio process and sticking to it is important.
Of course, one can pivot, but not everyday.
5 - Protect your capital in the bad times, catapult in the good times.
This is how you create alpha.
A good investment framework helps you take different decisions during periods of gain and correction.
This is how you create alpha.
A good investment framework helps you take different decisions during periods of gain and correction.
6 - Manage risk
Investing is all about managing risk.
This has two components - right buying price and position sizing.
Investing is all about managing risk.
This has two components - right buying price and position sizing.
7 - Cut the weeds water the flowers.
If you average the losers, you'll end up with a lot less capital and a lot more garbage.
If you cut your losses and hold your winners, you'll end up with a portfolio filled with a lot of winners.
If you average the losers, you'll end up with a lot less capital and a lot more garbage.
If you cut your losses and hold your winners, you'll end up with a portfolio filled with a lot of winners.
8 - Don't get anchored in the price when you bought a stock.
Your entry price doesn't matter to anyone but you.
What is important is to evaluate the fundamentals of the business at the current price.
Your entry price doesn't matter to anyone but you.
What is important is to evaluate the fundamentals of the business at the current price.
9 - Re-deployment is crucial
Re-deployment of capital is important for both businesses and for an investor.
Many times, one ends up deploying in a manner that generates sub par returns and this lands up destroying the overall portfolio returns.
Re-deployment of capital is important for both businesses and for an investor.
Many times, one ends up deploying in a manner that generates sub par returns and this lands up destroying the overall portfolio returns.
It is very important to look at expected returns each time you deploy capital, even if it is in your existing holdings.
10 - Compounding of knowledge is a lot more powerful when compared to compounding of wealth
Don't look for new stocks daily, instead deepen your study of the existing stocks.
With time, knowledge compounds and understanding increases manifold.
Don't look for new stocks daily, instead deepen your study of the existing stocks.
With time, knowledge compounds and understanding increases manifold.
Bonus - Vision & wisdom over knowledge and information
Information and knowledge was an edge 10-15 years ago.
Today it is a commodity.
Vision and wisdom provides an edge today and is likely continue for years.
Information and knowledge was an edge 10-15 years ago.
Today it is a commodity.
Vision and wisdom provides an edge today and is likely continue for years.
Bonus - Restrict yourself to your areas of competence.
Build an elimination framework.
This helps you spend enough time on the companies that you need to study.
Build an elimination framework.
This helps you spend enough time on the companies that you need to study.
If you want to attend - @ias_summit live, use the following link - pages.razorpay.com
They will also provide you with the recordings of the summit if you attend live.
They will also provide you with the recordings of the summit if you attend live.
If you'd like to be a part of my investing community - Indians Invest Globally.
Use the link below to join -
docs.google.com
Use the link below to join -
docs.google.com
Discl - I am a moderator/guest at the @ias_summit
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