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Shikari_Shambu
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Joined: 04/Jan/2008
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   Posted: 26/Jan/2009 at 12:34pm |
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My random thoughts
1) I dont't think Basantjee is ignoring margin of safety. Margin of safety does not come only by making purchase price attractive (though that is one of the easiest and proven way). Safety can also come from past history, proven track record, Management pedigree, scale of opportunity and host of other things. I might have some difference of opinion on HDFC Bank ( since I am willing to take a bit more risk for bit more returns in Axis),but there is no doubt that there is a good margin of safety in HDFC Bank at these prices.
2) When Basantjee got into PRIL and TV18, he had a great thing going since he had margin of safety coming from knock down prices as well as scale of opportunity.
3) Even now, there would be stocks which are in situations like PRIL,etc were in 2003 and I am sure Basantjee is looking at them. I don't think we should assume that he will hold on to HDFC Bank and Titan forever. These have been good stocks to hold on to for the past several months
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stockaddict
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Posted: 26/Jan/2009 at 1:37pm |
Shikari shambu,
The idea was not to find fault with any one person's style, we all know that Basantjee has done wonderfully well for himself, probably better than anyone else has done here. But we are looking for principles with universal application, one which a person with less wisdom and experience can also apply with reasonable success. As mentioned by you, Basantjee has explained many times here that he entered pantaloon and trent when they were going for a song using all available parameters of analysis.
The problem arises when others join in the party much later and at much much higher price, and when even the story may be hitting roadblocks, and say ' hey, basant has made a ton in this, it seems a great story, let me just join him to make some for myself' there goes the margin of safety and caution for a toss and when the tide turns , they are left holding the baby! That's why 'borrowed conviction' is dangerous. One should imitate the strategy and not the stocks (picked with a time lag) and try to find your own pantaloon, titan and HDFC bank.
Once again I see that since Basantjee's pick currently are Titan and HDFC Bank, some people see multibaggers here too ignoring his stated objectives of first preserving his wealth and then growing it, while their idea may be capital growth first at these knocked down values.
Edited by stockaddict - 26/Jan/2009 at 7:19pm
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basant
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Posted: 26/Jan/2009 at 3:15pm |
We are loosing focus from the topic of this thread!
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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
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HallaBol
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Posted: 26/Jan/2009 at 3:29pm |
Originally posted by Shikari_Shambu
Safety can also come from past history, proven track record, Management pedigree, scale of opportunity and host of other things. |
Definitely safety also comes from past history, proven track record, Management pedigree, scale of opportunity and host of other things. These things are also equally important. But, these things should be given a miss, if there is no margin of safety in the price.
Buying stocks cheap can wash all other sins.
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The future is never clear, you pay a very high price in the stock market for a cherry consensus. Uncertainty actually is the friend of the buyer of long-term values. - Warren Buffet
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basant
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Posted: 26/Jan/2009 at 8:43pm |
Originally posted by basant
Its amazing to see how much of a dent PRIL has made to the investors who bought it and the ones who did not In fact the protests are more from the latter then the former. Its become social cause to protest against Biyani but that should not matter to me since I made my capital out of that man only.
One of the successful aspects of investing (value or no value) is to exit a stock when the situation gets bad.
We all know what happened to Abhimanyu in Mahabharat surprisingly what looks value today can be over valued tomorrow and people who have no exit strategy will find it tough to protect capital at that time.
My 2000 losses really taught me that taking a capital loss as large as 50%+ is also a part of the game as making a 35 bagger. In this case I see reason why a trader should be distinguished with an investor a trader takes a loss if prices move against him an investor takes a loss if fundamentals move against him.
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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
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investor
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Posted: 26/Jan/2009 at 11:15am |
I agree completely, i was also in similar frame of mind earlier and now first priority has changed to how to protect capital. Market teaches us new things every time.
Originally posted by basant
At one point I was looking at stocks like this will go up only 5 times let me look at a 10 bagger now the question is. How much can I protect myself before we go out to bat again.
Things have come a full circle. We do learn new things from the market don't we? |
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The market is a place where people with money meet people with experience.
The people with experience get the money while people with money get experience!
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aloksahi1971
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Posted: 27/Jan/2009 at 12:19pm |
Now for this valuation and exsit . PRIL and Trent were both cheply available any sane person would have bet on the competence of the TATAS rather than Biyani who had a string of faliures causing asplit in the family. But then Biyani had th vision and Basant Sir the Money 
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Born To Golf forced to work.
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furkanalam
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Posted: 27/Jan/2009 at 4:27pm |
Yes after creating so much wealth from stock markets it is prudent enough to try to protect that.....This totally justifies HDFC Bank and Titan holdings of Basant.....
But for others who are new or 2-3 year old in this market...its time for them to look for 10 baggers or more as Basant had done when he entered share markets......then only can they think of protecting capital....so phases are different....
So strategies differ based on experience and wealth created......
Originally posted by investor
I agree completely, i was also in similar frame of mind earlier and now
first priority has changed to how to protect capital. Market teaches
us new things every time.
Originally posted by basant
At one point I was looking at stocks like this will go up only 5 times let me look at a 10 bagger now the question is. How much can I protect myself before we go out to bat again.
Things have come a full circle. We do learn new things from the market don't we? |
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