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28 Big Ideas on Investing, Business, Life, Behaviour, and Thinking (Special E-Book)

28 Big Ideas on Investing, Business, Life, Behaviour, and Thinking (Special E-Book)The world around us is changing pretty fast. Modern computers are becoming cheaper, faster and more intelligent than ever, which means they are ready to replace a large part of human workforce.

The day is not far when your work and skills will be threatened by artificial intelligence. To stay relevant, you need to ensure that you remain valuable to the society in a way which can’t be substituted by a robot.

And your only chance to remain valuable is by being a constant learner…a learning machine, as Charlie Munger says. In fact, he has been saying this for years –

I constantly see people rise in life who are not the smartest, sometimes not even the most diligent, but they are learning machines. They go to bed every night a little wiser than they were when they got up and boy does that help, particularly when you have a long run ahead of you.

The question is where do you start? There is so much to learn all around, and so little time.

Start with our latest special e-book – 28 Big Ideas on Investing, Business, Life, Behaviour, and Thinking.

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One Big Lesson I Learned Late in My Investing Life

One of the most profound thoughts I’ve ever read on the child-parent relationship comes from the noted Lebanese-American artist and poet Kahlil Gibran, who wrote the following under the title “On Children” –

Your children are not your children.
They are the sons and daughters of Life’s longing for itself.
They come through you but not from you,
And though they are with you yet they belong not to you.

You may give them your love but not your thoughts,
For they have their own thoughts.
You may house their bodies but not their souls,
For their souls dwell in the house of tomorrow,
which you cannot visit, not even in your dreams.
You may strive to be like them,
but seek not to make them like you.
For life goes not backward nor tarries with yesterday.

You are the bows from which your children
as living arrows are sent forth.
The archer sees the mark upon the path of the infinite,
and He bends you with His might
that His arrows may go swift and far.
Let your bending in the archer’s hand be for gladness;
For even as He loves the arrow that flies,
so He loves also the bow that is stable.

The first time I read these thoughts, my first reaction was – “If my children are not my children, then whose are they? And what do you mean they are not mine?”

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Value Investor Interview: Kuntal Shah

Note: This interview was originally published in the November 2016 issue of our premium newsletter – Value Investing Almanack (VIA). To read more such interviews and other deep thoughts on value investing, business analysis and behavioral finance, click here to subscribe to VIA.

Kuntal Shah - Value Investing AlmanackKuntal Shah is one of the founding partners of SageOne Investment Advisors and has an opportunistic inclination towards a value-oriented and risk-controlled approach to investments. He has been an extremely successful investor over the past two decades and his success has come from exploiting the inefficiencies inherent in the markets.

Kuntal has an in-depth understanding of value investing with a focus on risk identification and mitigation, emerging trends, and opportunities in key growth sectors in India, taxation and accounting. He also loves to teach on these subjects and in the past has lectured at UTI Institute of Capital Markets, IIM (Ahmedabad), IIT (Mumbai), Symbiosis, FLAME and Chartered Accountants Institute. Kuntal is an Electronics Engineer from Pune University.

Safal Niveshak (SN): Could you tell us a little about your background, and how you got interested in value investing?

Kuntal Shah (KS): I was brought up in a middle-class family in Mumbai. I am an engineer by qualification. Early life was a constant struggle to make ends meet for our family of five siblings given our father’s limited earnings. I was lucky to be brought up in an environment where there was no compromise on education and was fortunate to be inculcated with middle class working ethos, frugality and conservatism of living within one’s means without recourse to borrowing to prepone consumption.

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10 Qualities of Great Investors

Value Investing Workshops in Mumbai, Bangalore, Chennai – Registrations are now open for our upcoming workshops in Mumbai (22nd Jan), Bangalore (5th Feb), and Chennai (12th Feb). If you wish to attend, please click here to register.

One of the first lessons I learned from my Yoga teacher was what she told me during my first class – “Yoga isn’t about rapid movements but long pauses. Slow down, calm down, don’t hurry, and trust the process.”

The thing about yoga — or any exercise — is that there isn’t a comfort zone. But if you have a sound process, and practice it diligently, over time it starts to work for you.

The act of investing your money, as I realize, isn’t much different from practicing Yoga. A superior process and greatness often go hand in hand in yoga, and also in investing. For serious investors, thus, it’s wise to learn to trust the process that generates winning investment results.

I came across one such time-tested process framework recently while reading Michael Mauboussin’s “Reflections on the Ten Attributes of Great Investors.” Mauboussin is a Managing Director and Head of Global Financial Strategies at Credit Suisse, and author of some amazing books like The Success Equation and More Than You Know. He is one successful value investor, and thus the process he has laid out in his note is a great help for any serious investor seeking a winning investment process.

Here are my reviews of the ten attributes Mauboussin has laid out in his note.

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7 Acceptances (Not Resolutions) to Live By in 2017

I wish you a very happy, healthy, peaceful, and fulfilling 2017.

Life is short (it’s already almost six years since I started Safal Niveshak), so let me not waste another moment and thank you for being here for me.

As we begin 2017, let’s not start with New Year resolutions that anyways don’t last till 5th of January. Let’s start with some acceptances that you should come to terms with in 2017 and beyond.

Print what follows below – Your Note of Acceptance as an Investor – and look at it every day. It might help you deal better with the reality of the investing world.

Here it goes…

[My Note of Acceptance as an Investor]

  1. I will act stupid and envious at times and make mistakes, how much ever intelligent I am, and whatever resolution I make to avoid all mistakes this year.
  2. I, or anyone else, have no clue about the impact of macroeconomic or socio-political events on my investments.
  3. I, or anyone else, cannot predict the future of markets with any degree of accuracy, however certain things look like.
  4. I will lose a lot of money over time if I invest on tips, in bad businesses, with bad managements, and in expensive stocks.
  5. I may create wealth from stock market in the long run only if I practice patience in owning good businesses, not when I chase multibagger returns.
  6. Luck will play an important role in my investing, and especially when I make high returns in quick time.
  7. However good my investment process is, the outcome at times may not be to my liking.

Finally, it’s good to admit and accept that the future is inherently unknown and unknowable, and that there is no point blaming “uncertainty” for your investment mistakes and losses. Relax, and learn to appreciate the thrill of finding out what happens next. That’s the best part of being a stock market investor.

What you can control is your own behavior – and only to a certain extent – and how you respond to whatever happens around you. For all things outside your control – including return on your investment – there is no point fearing the future.

Stay happy, healthy, and peaceful.

Happy New Year!

P.S. The idea of this post comes from here.

Safal Niveshak’s 2016 Annual Letter to Tribe Members

Dear Tribe Member,

Trust you are doing great.

Here is a brief update on what transpired during 2016. It was another tremendous year for Safal Niveshak. The tribe has crossed 26,000 members. Our Twitter count has crossed 17,500 followers. We conducted five workshops during the year, meeting 120+ tribe members in the process.

The Mastermind Value Investing Course student count increased by 30%, while our premium newsletter – Value Investing Almanack (VIA) – which is about to complete two years, gained 25% new members, and has continued to receive some inspiring reviews from its subscribers. During the year, as part of the VIA, we interviewed a few wonderful value investors including Rajeev Thakkar, Jason Zweig, Samit Vartak, Kuntal Shah, and John Huber.

The idea to launch VIA in 2015 came from the need we felt of a detailed value investing newsletter in the Indian context, which had deep insights on the subject, business analysis, and interviews with practitioners of the art. We had always missed such a product in India, and could not find a better way to get it than to create it ourselves. The journey over the past two years of launching VIA has been inspiring for the breadth and depth of reading and learning we ourselves have done to bring our subscribers high quality content.

Anyways, in 2016, we also launched our first comprehensive e-book titled Mental Models, Investing, and You. This was just the first part of our collection of mental models notes we have written on Safal Niveshak so far (the second part releases in 2017), and received great reviews from readers. Despite our offer to people to get the e-book for free or pay as much as they wished, more than 850 people paid up, which was a much higher count than what we had expected.

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Investing and the Power of Serendipity

In July 2003 I was fresh out of college and was waiting to join my first job. I was excited but a little anxious too. The thought of transitioning from a laid back college life to a hectic corporate job was giving me jitters.

The life in college was quite predictable. The syllabus was fixed. If I studied the textbooks diligently and attended all the classes, I was supposed to graduate in four years with predictable grades.

But in the job, I had no clue what to expect. I didn’t know how my first boss would behave. Although there weren’t going to be any exams or pop quizzes in the job, there was no set curriculum either. It was a different flavour of uncertainty out there which I hadn’t tasted before.

So, to make the best use of my vacation before the corporate grill started, I thought of meeting someone who was successful in this field. I decided to meet the president of small scale industries association in my hometown.

“Uncle, I am about to join my first job in a chemical industry. What should I do to make the best use of my time in my job?” I asked him.

“Always keep your eyes and ears open. Opportunity can come from any direction. Be ready to grab it and work hard to capitalize on it,” he said. We spoke for about half an hour but these are the only three sentences that I still remember.

At that time, those words didn’t make much sense to me. However, after spending 10 years working in different jobs, I began to realize the importance of uncle’s advice.

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The 38th Lesson

On a warm Sunday morning in early-April this year, I got up with some pain in the little finger of my left hand. It was a small bump. It wasn’t there when I slept the previous night, so it seemed to have appeared out of nowhere.

“You may have hurt your finger while sleeping,” said my wife.

“But there’s no sign of a cut or bleeding!” I told her. “What could be this?”

“It happens sometimes,” she tried to soothe my nerves.

Anyways, a week passed, and then two, and that bump got slightly bigger. It was a bit painful earlier, then more, and then the pain gradually reduced. But the redness and the bump remained.

Over the next two months, I saw around five different doctors, and all asked me to wait and watch and do nothing. I thought none of these doctors knew anything about this bump because each one had named it differently. And that is when I did something I now realize was one of the biggest mistakes I’ve ever made in my life.

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