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Why not to look for new ideas – always?

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Printed Date: 25/Apr/2024 at 11:49pm


Topic: Why not to look for new ideas – always?
Posted By: basant
Subject: Why not to look for new ideas – always?
Date Posted: 18/Apr/2011 at 10:34am

One of the typical attributes of a young, impatient and a restless investor is to desperately look at new investing ideas when the existing ones look as promising as the rest. So the moment you meet someone the first question that comes to you is “Aur Naya Kya liya” (What did you buy new?). Isn’t that strange? Why do people want new things in life – always? So many families could have lived happily had people not looked for the new? Likewise so many investors could have stayed and become wealthy had they not tried identifying the new. Spare a thought for the guy who having bought Wipro in 1980 looked to exchange his stock for something new in 1981. A Rs 10,000 investment in the company would have grown to over Rs 350 crores had he just stayed with the old.

So does it mean that investors should do nothing and just sit back after an idea has been identified? Certainly not, all ideas need introspection and a constant monitoring vis-avis the new ones that come in every day. The only cost of investing is opportunity cost. So if Company A is doing well and someone whispers to you about the prospects of Company B then try comparing Company B with Company A before committing your money. If A is still better then B then buy A until you hi the 15% open offer limit!

Peter lynch says that the best stock to buy could be the one you already own.

Suppose you were running a restaurant, or a casino or a hotel, would you have looked at putting more money buying a new business each time your existing business threw back cash or would you have tried to consolidate your position in the business that provided maximum return for capital? Money has no emotion, given a free run it would flow to the spot that provides it maximum return but the emotions of the person in whose pocket the money resides allows it to do foolish things in the garb of looking at something new.

Many people look to buying something new to avoid the pitfalls of putting all eggs in one basket but one should remember that as long as the basket is strong and capable of holding the weight there is no harm in putting several eggs in one basket and if the basket is weak then even one egg can break the same. The idea is look for strong baskets not necessarily new ones.

There could be months where a smart astute and serious investor would not get new investing ideas in that case it would be prudent to analyse the existing stocks in the portfolio rather then hold cash and wait for new ideas. If a stock that he holds does not qualify as a buy then he has no business holding it in the first place.



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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in



Replies:
Posted By: catchsudipto
Date Posted: 18/Apr/2011 at 10:43am
Good One Basant Ji. 

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Make your Life as simple as possible.


Posted By: ash7979
Date Posted: 18/Apr/2011 at 10:50am
Golden words..."Peter lynch says that the best stock to buy could be the one you already own"....So True...

I always think HDFC bank is so boring & I should switch to some new stock in banking...but see the best banking stock is which I am already have:)


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Fear can hold you prisoner. Hope can set you free....


Posted By: bhowman
Date Posted: 18/Apr/2011 at 11:24am
The best stock to buy could be the one you already own.
We should internalise this nugget of wisdom-say it aloud hundreds of times,so it becomes part of our being.
Thank you Basant Ji.
 
Adi Shankara says-Dura dure anthithe cha.-meaning That which is so far is actually so near.He refers to the Atman.
For us,the pot of gold which we look for at the end of the rainbow,may already be there in our demat account
 


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That which is so far is actually so near.


Posted By: bsk0404
Date Posted: 18/Apr/2011 at 11:24am

Excellent one Basantji.



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There are only 2 tragedies in market 1st buying a good stock at wrong price 2n buying wrong stock at any price.


Posted By: somu0915
Date Posted: 18/Apr/2011 at 11:25am
Basantji -
Words of wisdom. Pearls of wisdom.
Investing looks simple but is not easy.
To hold on to current stocks for 10-20yrs is not a joke.
That is why people try to switch every 1-2 yrs.

The wait in capital markets is very very long to give you stellar returns.
How many people have that patience and conviction is what matters.


Posted By: RSS4245
Date Posted: 18/Apr/2011 at 11:41am

Basant ji tusi GR8 ho!! Clap



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FUNDOOSEARCH


Posted By: nagpal
Date Posted: 18/Apr/2011 at 11:54am
Amazing..I think you are 100% correct

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Be a Owner,Not a Loaner


Posted By: ferrari
Date Posted: 19/Apr/2011 at 12:07pm
Dear Basant ji keep posting such words of wisdom for the benefit of people like me.

I've learned a lot for this site, just that I need more discipline in practicing them





Posted By: Dundun
Date Posted: 19/Apr/2011 at 12:17pm
I rellly rellly like it :-)
Basant ji, it's very true what you said, probably I'm also in the same category....would try to exercise some discipline.



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Thanks,
Dundun


Posted By: jigneshk
Date Posted: 19/Apr/2011 at 12:37pm
Basant, Your best point is investor must be open and constantly evaluate existing stocks vis-a-vis new ones. Out of 5000 scrips we had 1 wipro, 1 Infosys etc. Bluechips of yesteryears like bombay dyeing, orkay,baroda rayon, century fared poorly in comparison. Due to same reason one doesn't know if the stock he is holding is THE stock of century like Wipro:-). A friend of mine doesn't follow WB/Value/Buy & Hold style of investing but still made 40 times returns in last 5 years which is 109% CAGR against Wipro's 53% :-).


Posted By: ajayganmohan
Date Posted: 19/Apr/2011 at 12:45pm
Good one. Each time I learn something new from your comments. Do keep writing more often.


Posted By: Kabootar
Date Posted: 19/Apr/2011 at 1:03pm
@Basantji: When I first saw the title , I thought it might be a typo and you actually meant the opposite. But I stand corrected after reading the whole write-up.

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Verbal diarrhoea! A most deadly disease.


Posted By: Kalyan
Date Posted: 19/Apr/2011 at 1:57pm
Excellent.

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kalyan


Posted By: abhishekbasu
Date Posted: 19/Apr/2011 at 2:30pm
Originally posted by basant

There could be months where a smart astute and serious investor would not get new investing ideas in that case it would be prudent to analyse the existing stocks in the portfolio rather then hold cash and wait for new ideas. If a stock that he holds does not qualify as a buy then he has no business holding it in the first place.



Wonderful post. However, I am not sure I agree 100% with the last line.

There are lots of reasons why people buy and hold stocks. Peter Lynch sometimes bought stocks just to be keyed in on its business. The thought behind it is that you tend to watch the companies that you are invested in more closely than others. Same for Rakesh Jhunjhunwala in India.

The last sentence seems to me contradictory to the overall message of the post. "If a stock that he holds does not qualify as a buy then he has no business holding it in the first place" -- implies that one should SELL any stock one holds that is currently not on his buy list.

Taking the Wipro example, there were times when Wipro performed extremely well (1999). If an investor would have sold out then, the record would perhaps not been as stellar. (Unless, of course, he had the foresight of putting the money into some other extraordinary stock).


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Posted By: wiseowl
Date Posted: 19/Apr/2011 at 2:44pm
Originally posted by abhishekbasu



 
There are lots of reasons why people buy and hold stocks. Peter Lynch sometimes bought stocks just to be keyed in on its business. The thought behind it is that you tend to watch the companies that you are invested in more closely than others. Same for Rakesh Jhunjhunwala in India.




Today there are several other ways to stay clued in to the business ; buying a stock is not a necessity. Annual reports are freely available on a company's website (and in many other places) and so are transcripts and audio recordings of conference calls. There are several business newspapers and news channels. Watching from the sidelines is more easily possible these days than earlier. Of course, one needs to have patience.

"If you don't feel comfortable owning something for 10 years, then don't own it for 10 minutes."  - Warren Buffett





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You alone are responsible for your actions.


Posted By: almeida
Date Posted: 19/Apr/2011 at 3:07pm

Nice words of wisdom. Great work.



Posted By: abhishekbasu
Date Posted: 19/Apr/2011 at 3:36pm
Originally posted by wiseowl

Originally posted by abhishekbasu



 
There are lots of reasons why people buy and hold stocks. Peter Lynch sometimes bought stocks just to be keyed in on its business. The thought behind it is that you tend to watch the companies that you are invested in more closely than others. Same for Rakesh Jhunjhunwala in India.




Today there are several other ways to stay clued in to the business ; buying a stock is not a necessity. Annual reports are freely available on a company's website (and in many other places) and so are transcripts and audio recordings of conference calls. There are several business newspapers and news channels. Watching from the sidelines is more easily possible these days than earlier. Of course, one needs to have patience.

"If you don't feel comfortable owning something for 10 years, then don't own it for 10 minutes."  - Warren Buffett



I think you missed the point that I was trying to make.

1. Don't you think Rakesh Jhunjhunwala/Peter Lynch has/had access to annual reports or newspapers or audio conferences or whatever else you mentioned? Sometimes, people buy into a stock so that they are more attentive to the developments in the company. That has nothing to do with accessibility of information.

2. Buffet is talking about "owning", not buying or selling. I absolutely agree with that. If I am not happy with a stock I own, I would rather sell. On the other hand, if I am not willing to BUY today, does not necessarily mean I will sell today.


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Posted By: j2eeprofessiona
Date Posted: 19/Apr/2011 at 6:14pm
Originally posted by abhishekbasu



The last sentence seems to me contradictory to the overall message of the post. "If a stock that he holds does not qualify as a buy then he has no business holding it in the first place" -- implies that one should SELL any stock one holds that is currently not on his buy list.


the point is not that. what's implied is that if the stock is not good enough to be bought (viz-a-viz the one u plan to buy), you should not be holding on to that stock. if you feel the scope is not too much then what's the point in holding it. go with the stock with better scope of appreciation. thats what i think is the implied meaning.


Posted By: itpro
Date Posted: 19/Apr/2011 at 7:22pm
Originally posted by j2eeprofessiona

 
what's implied is that if the stock is not good enough to be bought (viz-a-viz the one u plan to buy), you should not be holding on to that stock. if you feel the scope is not too much then what's the point in holding it. go with the stock with better scope of appreciation. thats what i think is the implied meaning.
When do we know this? There are up's and down's....one can sell out or hold on? That itself is a question.
 
take example of Wipro... it is currently not delivering.. some of the better bet is TCS. But in previous there must have lot's of up's and downs'... and one who has held on got a spectacular return... but at the same time we can't say that the one who has switched has got the lesser return. He might have got better return...


Posted By: getmanoj
Date Posted: 19/Apr/2011 at 8:20pm
[ So many families could have lived happily had people not looked for the new ? ] ..... we missed this gem ;) ...
The charm of buying "new" is there, not only in stock market but in day to day life as well... most of us like to buy new phone, new gadget, new house , new car .. although they don't necessarily provide the best option (on a price-value basis).


Posted By: csbhasin
Date Posted: 19/Apr/2011 at 8:23pm
Clap

Excellent article and intelligent guidance for the forum members.

It is seen that what ever we save that we invest some where and those have knowledge of investment in share definitely put more and more in shares only. They keep aside  many other important pending task or go on postponing to put money in other necessities and prefer to put more and more money in share. [ If you do not agree then please guide what should be the philosophy of investment or life in this regard.]

Sir, now, one thing I wish to know that if we go on adding more and more shares to our portfolio then when we should sell them so as to enjoy the fruit and compete our pending tasks.

csb


Posted By: csbhasin
Date Posted: 19/Apr/2011 at 8:33pm
notify me of reply


Posted By: bmchandrasekhar
Date Posted: 19/Apr/2011 at 9:08pm
Excellent article by Basantji. That's why home cooked food by our mothers are taken for granted and people relish 5 Star food and why Sholay is still a 3000 bagger movie instead of watching new ones.
 
"Intelligence and Brilliance may win the day but its wisdom that endures."- Peter Drucker


Posted By: basant
Date Posted: 19/Apr/2011 at 9:26pm
Originally posted by csbhasin

Clap

Sir, now, one thing I wish to know that if we go on adding more and more shares to our portfolio then when we should sell them so as to enjoy the fruit and compete our pending tasks.
 
If you want to compeltely live off your investing you should wait till your investments become 50 times your basic annual expense.
 
But ultimately life has to be enjoyed. All our assets are there to make our lives better whether it is the shares in your demat account or the necklace around the ladies neck if the quality of life isn't showing signs of improvement inspite of this then the assets are not being utilized to their potential.
 
Now this does not mean that people can enjoy only by spending some money, some people enjoy by taking a walk on the beach some can do so by having a bath in the rain but the point is if you have higher levels of enjoyment (taking a vacation every three months) and can afford it by spending please do not torture yourself by acting stingy.
 
 
Originally posted by getmanoj

[ So many families could have lived happily had people not looked for the new ? ] ..... we missed this gem ;) ...
The charm of buying "new" is there, not only in stock market but in day to day life as well... most of us like to buy new phone, new gadget, new house , new car .. although they don't necessarily provide the best option (on a price-value basis).
 
Very correct. Charlie Munger says to underspend yourself till you accumulate US $ 100,000 of savings.
 


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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in


Posted By: rosicrucian
Date Posted: 19/Apr/2011 at 9:48pm
Though wipro,Infy stories are often recited again and again, but one must not forget that in 1981 it required guts to buy such company.
wipro was oil and soap companay(as investor knew it that time), and infy was unheard.
who had ever thought in 1991 india shall be liberized?
in 94, even employes of Infy were sceptical about the co. and ESOP was not fully subscribed.
Even Ashok Arora ,who was the best coder amongst all Infy cofounders,left the company in 1989 when Infy was about to collapse.
That time was when KSA in USA shut the shop.
Arora sold his shares for 25 lakhs to other promoters, which would have been turned to billions, if he had not.
 
For 1 infosys there were 10 companies which literally wiped the floor with investors.
 
When insiders did not have faith in the company how one can expect common man to have faith in that company(at that time)?
 
similarly with zicom, the was about to shut and all of a sudden 9:11 happens and the company just got a powerful shot in the arm.
what I want to say , what pays is conviction,and if not conviction then destiny.
 


Posted By: kulman
Date Posted: 19/Apr/2011 at 9:51pm
some people enjoy by taking a walk on the beach


Smile

I do.




Posted By: MR TED
Date Posted: 19/Apr/2011 at 12:02pm
Originally posted by basant

So if Company A is doing well and someone whispers to you about the prospects of Company B then try comparing Company B with Company A before committing your money. If A is still better then B then buy A until you hi the 15% open offer limit!

Interesting read. These are the words of a man who has immense conviction in his ideas, who is open to new ideas as well, but only if the new ones offer much more conviction Clap

2 questions -

1.  what does "If A is still better then B then buy A until you hi the 15% open offer limit!" mean?

2. Each idea comes with a risk reward. Probably why people look for new ideas is to try a different risk reward ratio?



Posted By: leo2007
Date Posted: 19/Apr/2011 at 9:51am
Originally posted by basant


If you want to compeltely live off your investing you should wait till your investments become 50 times your basic annual expense.
 
 
 
I feel this formula should have ralation to the person's age also. A 50 year old person is not expected to live for another 50 years.


Posted By: leo2007
Date Posted: 19/Apr/2011 at 9:59am
Originally posted by kulman

some people enjoy by taking a walk on the beach


Smile

I do.


 
Kulmanji
 
I enjoy torturing myself  by acting stingy


Posted By: basant
Date Posted: 19/Apr/2011 at 10:04am
That is what I wanted to suggest that to reduce risk (by diversifying) people buy more of the new unknown comapnies which to some level (4 to 15 stocks) seems ok but not beyond it.
 
Originally posted by MR TED

Originally posted by basant

So if Company A is doing well and someone whispers to you about the prospects of Company B then try comparing Company B with Company A before committing your money. If A is still better then B then buy A until you hi the 15% open offer limit!

Interesting read. These are the words of a man who has immense conviction in his ideas, who is open to new ideas as well, but only if the new ones offer much more conviction Clap

2 questions -

1.  what does "If A is still better then B then buy A until you hi the 15% open offer limit!" mean?

2. Each idea comes with a risk reward. Probably why people look for new ideas is to try a different risk reward ratio?

 
I am assuming that you want to keep your real investments (wealth adjusted for inflation) intact - for the next generation.
 
Originally posted by leo2007

Originally posted by basant


If you want to compeltely live off your investing you should wait till your investments become 50 times your basic annual expense.
 
 
 
I feel this formula should have ralation to the person's age also. A 50 year old person is not expected to live for another 50 years.


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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in


Posted By: basant
Date Posted: 19/Apr/2011 at 10:07am
You can'tr enjoy torturing yourself. Seems contradictory. If you really enjoy that then it is ok to be self tortured because you are enjoying and also saving money.Wink
 
Originally posted by leo2007

Originally posted by kulman

some people enjoy by taking a walk on the beach


Smile

I do.


 
Kulmanji
 
I enjoy torturing myself  by acting stingy


-------------
'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in


Posted By: bhowman
Date Posted: 19/Apr/2011 at 10:20am
Originally posted by kulman

some people enjoy by taking a walk on the beach


Smile

I do.


 
Some others enjoy by watching people take a walkon the beach.


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That which is so far is actually so near.


Posted By: kulman
Date Posted: 20/Apr/2011 at 12:07pm
Originally posted by bhowman

Originally posted by kulman

some people enjoy by taking a walk on the beach
Smile
I do.

Some others enjoy by watching people take a walkon the beach.


Smile  

Hmmm.....to each his own.




Posted By: ramsey123
Date Posted: 20/Apr/2011 at 12:25pm
Originally posted by basant

If you want to compeltely live off your investing you should wait till your investments become 50 times your basic annual expense.
 
 
Does this take into account inflation considering a 15-20 year horizon?


Posted By: csbhasin
Date Posted: 20/Apr/2011 at 12:41pm
Topic: Why not to look for new ideas – always?
    Posted: 18/Apr/2011 at 10:34am

Basant Sir,

Thanks for your guidance. i.e. live off when investment become 50 times of you annual expenses.

cs bhasin


Posted By: MR TED
Date Posted: 20/Apr/2011 at 12:55pm
Basantji

Wanted to ask you, in TED 11, do you hold the same conviction that you did when you first included them in TED 11.

Also, do you personally own them? I feel you cannot own 11 stocks. A man of your level of conviction will hold much less Smile


Posted By: basant
Date Posted: 20/Apr/2011 at 2:12pm
Convictions change with earnings, execution of business plans and capital spending habits of the management so for some companies the conviction has increased whereas for the others it has deteriorated.
 
I own a few (not all) of the TED XI stocks.


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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in


Posted By: rinkumalpani
Date Posted: 20/Apr/2011 at 2:27pm
Originally posted by basant

Convictions change with earnings, execution of business plans and capital spending habits of the management so for some companies the conviction has increased whereas for the others it has deteriorated.


 

I own a few (not all) of the TED XI stocks.



..so, for a person invested as per ted xi, would you suggest to keep the winners and shed/replace the losers..


Posted By: Buffet Glb
Date Posted: 20/Apr/2011 at 4:33pm
Hello Basantji,

Good discussion to throw light on the inherent desire of mind to keep looking endlessly.

It boils to don't react just for sake of gratification but respond depending on the need. They are not very rewarding more often.

Apart form investing in the existing stocks (pyramiding), you have raised another debatable issue of concentrated portfolio & diversified portfolio. My take would be even for an average investor (not trader), who happens to be the majority, Diversified portfolio investing is the most practical way for more than average returns. The returns theoretically might be more in concentrated portfolio investing but the strike rate is too less to venture.

Finally, if you have a good business that you feel you have missed earlier, the same stock is still worth purchasing later as well with long term perspective in mind.


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"The best assets you can have during inflation are your abilities." - Warren Buffett


Posted By: basant
Date Posted: 20/Apr/2011 at 4:38pm
Yes, it does if you look ayt it it is 2pc of your portfolio add 6 pc inflation so a return of 8% will keep you ok with the real value of investments.
 
Originally posted by ramsey123

Originally posted by basant

If you want to compeltely live off your investing you should wait till your investments become 50 times your basic annual expense.
 
 
Does this take into account inflation considering a 15-20 year horizon?
 
Yes, that is the argument plus you can add more even if the stock moves up from your last purchase price.
 
Originally posted by Buffet Glb



Finally, if you have a good business that you feel you have missed earlier, the same stock is still worth purchasing later as well with long term perspective in mind.


-------------
'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in


Posted By: ramsey123
Date Posted: 20/Apr/2011 at 8:01pm
Originally posted by basant

Yes, it does if you look ayt it it is 2pc of your portfolio add 6 pc inflation so a return of 8% will keep you ok with the real value of investments.
 
 
Basantji, thanks indeed for a great formula in that case.


Posted By: MR TED
Date Posted: 20/Apr/2011 at 12:29pm
Originally posted by basant

Convictions change with earnings, execution of business plans and capital spending habits of the management so for some companies the conviction has increased whereas for the others it has deteriorated.


Thanks Basantji. An interesting point you have made here.
This makes me think that as we maintain and monitor the percentage returns of TED 11 stocks, we should also monitor the Conviction levels, based on the parameters stated by you above, say once every quarter.

Like Conviction increased or decreased or at same level. Probably all start with 0 points (initial conviction), then for every positive action by the company we add 1 and subtract 1 for every not so good activity.

This Conviction Scorecard will solve the problems of all newbies who keep asking whether TED 11 stocks are still a good buy Smile


Posted By: ash7979
Date Posted: 20/Apr/2011 at 10:16am
Originally posted by MR TED

Originally posted by basant

Convictions change with earnings, execution of business plans and capital spending habits of the management so for some companies the conviction has increased whereas for the others it has deteriorated.


Thanks Basantji. An interesting point you have made here.
This makes me think that as we maintain and monitor the percentage returns of TED 11 stocks, we should also monitor the Conviction levels, based on the parameters stated by you above, say once every quarter.

Like Conviction increased or decreased or at same level. Probably all start with 0 points (initial conviction), then for every positive action by the company we add 1 and subtract 1 for every not so good activity.

This Conviction Scorecard will solve the problems of all newbies who keep asking whether TED 11 stocks are still a good buy Smile


If this is So Simple (Keeping a conviction scoreboard on TED) then I would say we must do this, this will help immensely to all newbies on TED (Including me:))....Anyway thanks to Basantji & all senior ppls here for making TED syuch a wonderful place to be in...


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Fear can hold you prisoner. Hope can set you free....


Posted By: MR TED
Date Posted: 21/Apr/2011 at 12:42pm
Originally posted by ash7979

Originally posted by MR TED

Originally posted by basant

Convictions change with earnings, execution of business plans and capital spending habits of the management so for some companies the conviction has increased whereas for the others it has deteriorated.


Thanks Basantji. An interesting point you have made here.
This makes me think that as we maintain and monitor the percentage returns of TED 11 stocks, we should also monitor the Conviction levels, based on the parameters stated by you above, say once every quarter.

Like Conviction increased or decreased or at same level. Probably all start with 0 points (initial conviction), then for every positive action by the company we add 1 and subtract 1 for every not so good activity.

This Conviction Scorecard will solve the problems of all newbies who keep asking whether TED 11 stocks are still a good buy Smile


If this is So Simple (Keeping a conviction scoreboard on TED) then I would say we must do this, this will help immensely to all newbies on TED (Including me:))....Anyway thanks to Basantji & all senior ppls here for making TED syuch a wonderful place to be in...


Conviction is intangible and comes from multiple factors. However, we can try to make it tangible for benefit of all. More so, for the reason that we want to hold on to our earlier ideas. I assume that stocks in TED 11 must be closely monitored by many people on this forum, because they own them. Any one can cite the events and actions of the companies, and Basantji can decide whether it is a +1 or -1 or NIL effect on existing conviction level of that stock Smile


Posted By: breeze
Date Posted: 24/Apr/2011 at 9:07pm
Very well said. Thanks for your teachings!


Posted By: subu76
Date Posted: 30/Apr/2011 at 8:55pm
Originally posted by rosicrucian

Though wipro,Infy stories are often recited again and again, but one must not forget that in 1981 it required guts to buy such company.
wipro was oil and soap companay(as investor knew it that time), and infy was unheard.
who had ever thought in 1991 india shall be liberized?
in 94, even employes of Infy were sceptical about the co. and ESOP was not fully subscribed.
Even Ashok Arora ,who was the best coder amongst all Infy cofounders,left the company in 1989 when Infy was about to collapse.
That time was when KSA in USA shut the shop.
Arora sold his shares for 25 lakhs to other promoters, which would have been turned to billions, if he had not.
 
For 1 infosys there were 10 companies which literally wiped the floor with investors.
 
When insiders did not have faith in the company how one can expect common man to have faith in that company(at that time)?
 
similarly with zicom, the was about to shut and all of a sudden 9:11 happens and the company just got a powerful shot in the arm.
what I want to say , what pays is conviction,and if not conviction then destiny.
 
 
The points are well taken.
 
I'd say part of the reason why ESOPs were not fully subscribed was because of lack of any known ESOP stock market success stories at that time. (Unlike in California which had seen employees getting super rich from the stocks of companies like Netscape)
 
In 1995 when i remember Infy would hire about 60-70 people from various engineering colleges......that itself should have given a hint about exploding business opportunities...
 
Offcourse, in hindsight it all looks very easySmile


Posted By: jigneshk
Date Posted: 08/May/2011 at 2:50pm
subu76, You have made good points and I totally agree. For 1 Infy we don't know how many companies vanished. I would think original and think what gives me success rather than become a sheep and follow textbook or successful investors. Friend (aged 32) who made 50 times return in 5 years has till date not read a single book on WB/PL etc :-).


Posted By: drsatish91
Date Posted: 09/Jul/2011 at 7:32pm
[QUOTE=basant]

So does it mean that investors should do nothing and just sit back after an idea has been identified? Certainly not, all ideas need introspection and a constant monitoring vis-avis the new ones that come in every day. The only cost of investing is opportunity cost. So if Company A is doing well and someone whispers to you about the prospects of Company B then try comparing Company B with Company A before committing your money. If A is still better then B then buy A until you hi the 15% open offer limit!

this paragraph answers many queries at once ....approx. 1 yr back when i joined TED .. i was the typical investor (self-acclaimed) described by Basant sir and i was so restless;i bothered Mr Basant so many times .. but as we all know teacher knows what to give and when to give he made me patient and calm .. stimulated my brain with queries that one has to ask himself before investing our hard earned money to merciless Mr Market .. I am Thankful to Mr Basant not only for guidance but also for the creating this wonderful GPS (TED) system for people who really want to cross this jungle (financial) and meet their goals ... Hats off to all TEDies


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Dr.Satish M Jethwani


Posted By: subu76
Date Posted: 09/Jul/2011 at 10:23pm
That's just great to see your evolution. Thank You Basant Sir for helping evolve our emotional outlook to investing


Posted By: norvinm
Date Posted: 11/Jul/2011 at 12:38pm
Jignesh, what principles has your friend been using to generate such returns?


Posted By: gurleen
Date Posted: 08/Sep/2011 at 10:37am
Really great Information Post. Please keep sharing more and more information . You really doing great job.Keep it up.


Posted By: bmchandrasekhar
Date Posted: 11/Sep/2011 at 11:11am
It's really great information. That's why I keep buying what I already own!! Sriram Transport finance.


Posted By: TCSer
Date Posted: 17/Sep/2011 at 8:00pm
Dear Chandra whats your take on ramky post CBI raids on them due to investments in YSR/Jagan cos?I am stuck in it @ 450.

Vivek 

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Share market is nothing but a game of temperament. Success mantra Right Price,Right Business,Patience, Conviction .Do not do panic buying or selling.It may be the only profession where inactivity pays


Posted By: bmchandrasekhar
Date Posted: 17/Sep/2011 at 9:40pm
CBI Sought information on some of the projects awareded during YSR Rule during 2004-09. As the Chairman was close to late YSR, it would have had a bearing on the CBI seeking information.
 
As such, there has been no untoward negative news as far as fundamentals of the business is concerned.
 
I am not sure why you are so worried about the price? If you have conviction about the business, any drop in share price should be construed as a buying opportunity.
 
Chandra


Posted By: gcgill
Date Posted: 21/Sep/2011 at 6:01pm
Basant ji,
I actually agree with your thought but i was just thinking of people who dont book profits at a stage when the stock gives them phenomenal returns ie maybe 100 or 200% in a short span of time.And then something happens like a sector collapse like the IT sector bust and they cant even recover their invested amount.I dont know about the valuations but they repent a lot after that.Just a thought....


Posted By: ravi123
Date Posted: 21/Sep/2011 at 6:08pm
Originally posted by TCSer

Dear Chandra whats your take on ramky post CBI raids on them due to investments in YSR/Jagan cos?I am stuck in it @ 450.

Vivek 


Jaganmohan Reddy met Sonia Gandhiji in a cordial atmosphere where the discussions were fruitful and productive. Sonia Gandhiji directed the CBI not to harass Jaganji from now on......according to a newspaper 'The Hindu".
Jagan I suspect has to eventually merge his party with the Congress-I. So no  IT raids by CBI on Jagan!


Posted By: Torrance
Date Posted: 11/Oct/2011 at 11:44pm
Whether and to what extent to look for new ideas surely depends on the state of the economy, and right now the economy is seriously in flux worldwide. We have been trying for decades to balance it on an inadequate base of consumer demand as wages paid for work have declined, and now it has broken down. Governments are floundering in trying to fix the problem, and popular protest movements are arising. There is no way to predict where things are going from here.

Under conditions like that, a prudent investor surely will avoid getting stuck in a rut.


Posted By: siloni
Date Posted: 11/Oct/2011 at 10:43am
i think active pessimism like the one stated by torrance ,is shared by most people presently,so the stocks in some pockets are available at attractive valuations!of course the state of the world affairs is surely in doldrums,but you want stocks cheap then how will you get them if everything is going great?
will the consumers of world"s companies stop eating food,wearing clothes,consuming things---?there can be slowdown massively but then there is our real task and art of identifying cos to invest with certain parameters and allocate capital prudently.historically there have been problems in the world periodically,whish then seemed herculan e.g. -ww1,the great depression of 1930 , ww2 nuclear cold war,iraq war,but as mankind has to survive,the world tends to come out of it eventually.

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jbeh20032003


Posted By: MR TED
Date Posted: 16/Oct/2011 at 4:09pm
Originally posted by siloni

i think active pessimism like the one stated by torrance ,is shared by most people presently,so the stocks in some pockets are available at attractive valuations!of course the state of the world affairs is surely in doldrums,but you want stocks cheap then how will you get them if everything is going great?
will the consumers of world"s companies stop eating food,wearing clothes,consuming things---?there can be slowdown massively but then there is our real task and art of identifying cos to invest with certain parameters and allocate capital prudently.historically there have been problems in the world periodically,whish then seemed herculan e.g. -ww1,the great depression of 1930 , ww2 nuclear cold war,iraq war,but as mankind has to survive,the world tends to come out of it eventually.
Like your attitude!! Smile


Posted By: siloni
Date Posted: 16/Oct/2011 at 5:06pm
its not my attitude mr.ted.it is a fact of life.

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jbeh20032003


Posted By: MR TED
Date Posted: 16/Oct/2011 at 5:12pm
Originally posted by siloni

its not my attitude mr.ted.it is a fact of life.
Again Like your attitude Smile
How many people remember facts of life and talk them aloud when it matters? Smile


Posted By: ecgoogle99
Date Posted: 22/Nov/2011 at 11:48am
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Posted By: AnushkaSingh
Date Posted: 02/Dec/2011 at 11:03am
Good Basant ji...your thread for best for share investor.
your line..'Peter lynch says that the best stock to buy could be the one you already own'its a true word.
Amazing..I think your thought are correct .


Posted By: rekonviliams
Date Posted: 07/Dec/2011 at 12:24pm
Basant Ji You Are Awesome.........

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Posted By: harjeet
Date Posted: 14/Mar/2012 at 12:31pm
WOW !! Great thoughts basant sir
Amazing.Smile
SmileSmileSmileClapSmile

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Posted By: pay2gain
Date Posted: 15/Mar/2012 at 1:10pm
The post was really very informative. Definitely its better to stick on to our stocks which we already hold.

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pay2gain


Posted By: Ayush1610
Date Posted: 16/Mar/2012 at 12:02pm
Thank You so much for such valuable idea Basant Sir. I had a lot of bad experience about tips providers. Due to that i lost big big money. Now i am in bad shape. I want to get back my losses from the tips from this site however if truth be told, i would like to thank so much for your advanced thought.

Recently I have started following a online tool called dynamiclevels. The best part of it is that it shows Technical Levels for last 14 Years of 15 Countries and 35 Exchanges in one window.



Regards,
Ayush Prem
Kolkata
https://www.dynamiclevels.com/index/# -

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Self Employeed Mathematics Graduate, having six and a half years of stock market experience. Followed Robert prechter’s way of Elliott wave theory and then Glenn Neely’s Neowave.


Posted By: koolvalue
Date Posted: 16/Mar/2012 at 2:24pm
Basant Sir,
I beg to differ on this with you and expect you to throw
some light from lost opportunity by neglecting new ideas
totally.

We cannot neglect the fact that all the companies which
went on to become multibagers were new ideas once upon a time.

Wipro,Infosis,reliance,unitech,bharati,hero honda,pantaloon,HDFC bank,---- and the list goes on.

The point I feel is there is nothing wrong in chasing
new ideas and one can reinvest small portion of realised
profits from mature investments in select few new ideas
time to time.


Posted By: basant
Date Posted: 16/Mar/2012 at 2:30pm
I agree that is why there is an "always" in the caption.

-------------
'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in


Posted By: somu0915
Date Posted: 16/Mar/2012 at 2:33pm
Originally posted by basant

I agree that is why there is an "always" in the caption.
Very witty answer Tongue


Posted By: koolvalue
Date Posted: 16/Mar/2012 at 2:39pm
Thank You Basant Sir,

Your remarks and comments are like lighthouse for investors
like me who use them as benchmarks to take decisions while
investing.


Posted By: rinkumalpani
Date Posted: 16/Mar/2012 at 2:48pm
Originally posted by pay2gain

The post was really very informative. Definitely its better to stick on to our stocks which we already hold.


Did I miss something? which post are you referring to??


Posted By: rajesh_mahinder
Date Posted: 10/Jun/2012 at 10:38pm
Originally posted by wiseowl


"If you don't feel comfortable owning something for 10 years, then don't own it for 10 minutes." - Warren Buffett

Best advice from the grand old man of investing!


Posted By: shilpa02
Date Posted: 06/Jul/2012 at 1:15pm
Hello..i m shilpa...i m very new here...i want to share ideas and views related various topics...thanx


Posted By: akja.05
Date Posted: 25/Mar/2013 at 2:32am
Hi Basantji
just read this thread.....Have a question regarding my investing style
I always seem to find a way to be 100% invested....My major investments will be in companies what I think are high quality but the remaining cash I do deploy in commodities, cyclical's etc as I feel they also project a money making opportunity (not permanent value but temporary value)....My logic is to be invested fully, in case it is a new bull market.....And as and when stronger opportunity presents itself, I exchange a relatively weaker idea for that stronger one
My question is this a better way of investing or is it better being in cash and wait and wait until the truly great idea comes along.....
Since I am a relatively new investor, I do not have the confidence to hold only 4-5 stocks.. My portfolio consists of 10-12 stocks at any point in time
I do see myself always looking for new ideas either to deploy existing cash or to look for stronger opportunities as in the long term, I wish to hold a more concentrated portfolio


Posted By: sumitraepic
Date Posted: 05/Oct/2015 at 6:45pm
I agree with you Basantji. I always follow your ideas and searching for new investment  ideas which can help me as well as others.


Posted By: jayakrishnan
Date Posted: 05/Oct/2015 at 8:32pm
It is better to stick with your initial ideas and stay with it for long, giving it enough time to work instead of keep on swinging at every ideas that crops up...Unless new idea is very convincing do not change initial ideas...
Also I do not believe in holding some money in cash like fund managers do keeping on waiting for opportunities that might occur 1-2 times in a decade...calculate the opportunity lost during those waiting period even for a bare minimum of 10% cash in hand...
Even if such a wonderful opportunity arises that you are very much convinced then you can always sell 1 from your existing holding even if it is at loss if your conviction is that high...


Posted By: sumitraepic
Date Posted: 21/Oct/2015 at 6:22pm
Generally traders follow a particular strategy for investment, they don't search for new ideas because no one wants to take risks.

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http://www.epicresearch.co/commodity-tips/ - Commodity Tips


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Posted By: sumitraepic
Date Posted: 24/Nov/2015 at 2:41pm
I always thought that trading is not for every person, but after reading your article, I found that by using some information anyone can easily invest in the market.


-------------
http://www.epicresearch.co/commodity-tips/ - Commodity Tips


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