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Safal Niveshak Stream – November 26, 2016

Note to Readers: In Stream, we suggest worthwhile reading material on a variety of topics, not all of which are directly related to investing. Some of the articles require you to be paid subscriber of those sites. However, it is often possible to read such articles by going to Google News and searching for the article’s title.



Some nice stuff we are reading, watching, and observing at the start of this weekend…

Investing/Stock Market

  • (3 minutes watch) Recently, government of India took a drastic step to invalidate the Rs. 1000 and Rs. 500 currency notes. We don’t have any opinion on how effective or ineffective this demonetization step would be in addressing the problem of black money and fake currency. However, it would be very interesting to see the unintended (positive and negative) consequences of this policy. One immediate effect was that people started hoarding Rs. 100 notes. Valid currency notes (1000s and 500s) suddenly turned into bad money and it drove out the good money (lower denomination notes i.e. 50s and 100s), perhaps temporarily, from the circulation. This is known as Gresham’s law. It is a monetary principle stating that “bad money drives out good.” Watch the latest episode of Latticework of Mental Models video series on Gresham’s Law.

    Click Here if you can’t see the video above. [Read more…]

Safal Niveshak Stream – November 19, 2016

Note to Readers: In Stream, we suggest worthwhile reading material on a variety of topics, not all of which are directly related to investing. Some of the articles require you to be paid subscriber of those sites. However, it is often possible to read such articles by going to Google News and searching for the article’s title.



Some nice stuff we are reading, watching, and observing at the start of this weekend…

Life/Learning

  • (970 words / 4 minutes read) Nilanjana Roy discusses the concept of being a “time-millionaire”, a measure of how much person has control over his or her time. It’s not so straightforward to draw an analogy between time and money in the bank. However, the importance of having control of one’s time cannot be emphasized enough when it comes to understanding human happiness…

    The American writer and blogger Mason Currey tracked the daily routines of 161 highly creative people, from Twyla Tharp and Agatha Christie to Matisse and Benjamin Franklin, in Daily Rituals: How Artists Work. Despite wide variations in working styles and habits, some patterns emerge. The brightest humans find work satisfying in itself, continuing to be productive long after they’ve achieved financial stability; they tend to work for a few hours every day, with the odd marathon session.

    The most happily successful people you might imagine — Warren Buffett, for example — have the knack of enjoying what they do for work, and take time off to play bridge, learn the ukulele, or whatever. Although Currey didn’t explicitly say this, it also becomes clear that highly creative people exercise iron control over their time — and enjoy spending time, perhaps as much as we’re conditioned to think of enjoying spending wealth.

    [Read more…]

Safal Niveshak Stream – November 12, 2016

Note to Readers: In Stream, we suggest worthwhile reading material on a variety of topics, not all of which are directly related to investing. Some of the articles require you to be paid subscriber of those sites. However, it is often possible to read such articles by going to Google News and searching for the article’s title.



Some nice stuff we are reading, watching, and observing at the start of this weekend…

Life/Learning

  • (1250 words / 6 minutes read) The ability to expand your mind and strive for lifelong learning is more critical to your success than you think. Don’t give up on lifelong learning. Ever. Research shows that it pays beyond the skills you acquire. More than ever before, a challenged, stimulated brain may well be the key to a vibrant later life. There are a few skills that are hard to learn but pay off for the rest of your life. Like the skill of adaptability…

    We live in ever-changing world which is unlikely to ever slow down. So, what mattered yesterday (e.g. skill, knowledge, social circle, etc.) very much so might not be worth a dime tomorrow. Change used to be slow and incremental: now it is rapid, radical and unpredictable.

    Adaptability enables us to dwell on new circumstances and stay on top of the situation. Of course, this skill is best when combined with insight, giving us fresh perspective before the change itself. Growth depends on how adaptable you are. To stay relevant, most companies will need people who can change with time.

    [Read more…]

Safal Niveshak Stream – November 9, 2016

Note to Readers: In Stream, we suggest worthwhile reading material on a variety of topics, not all of which are directly related to investing. Some of the articles require you to be paid subscriber of those sites. However, it is often possible to read such articles by going to Google News and searching for the article’s title.



Some nice stuff we are reading, watching, and observing during the middle of this week…

Investing/Stock Market

  • (1700 words/7 minutes read): It’s said that there’s very little we can learn from successes for studying successful people is fraught with survivorship bias. However, one shouldn’t outrightly reject the idea of looking at methods of successful because it does have some value. John Huber in his latest post on the competitive advantage of an owner-operator writes –

    …the risk of succumbing to survivorship bias is a risk worth taking. I’d rather risk that bias in exchange for the reward of potentially learning something useful from these success stories…They key is trying to reverse engineer their success while simultaneously being aware of the inherent bias can occur when analyzing these situations…. So it’s good to be aware of bias (hindsight, survivorship, etc…), but it’s not worth letting those biases restrict you from trying to learn why something or someone became so successful.

  • (3 minutes watch): Here’s the next episode of Latticework Video Series. In this video we explain a very important mental model from the field of Statistics, called Mean Reversion, and what investing lessons one can draw from this big idea. Click here to watch the video. [Read more…]

Safal Niveshak Stream – October 26, 2016

Note to Readers: In Stream, we suggest worthwhile reading material on a variety of topics, not all of which are directly related to investing. Some of the articles require you to be paid subscriber of those sites. However, it is often possible to read such articles by going to Google News and searching for the article’s title.



Some nice stuff we are reading, watching, and observing during the middle of this week…

Life/Learning

  • (2100 words/9 minutes read): Do you know the three important life skills nobody ever taught you? Please don’t take it personally, be open to changing your long and dearly held beliefs and the most important one – get comfortable with uncertainty…

    When something tragic happens and you become horribly hurt, as much as your pain has you absolutely convinced that this must be about you, remember that hardship is part of choosing to live, that the tragedy of death is what gives meaning to life, and that pain has no prejudice — it afflicts us all. Deserving or not deserving isn’t part of the equation.

    When you decide to change careers, there’s no one there telling you which career is right for you. When you decide to commit to someone, there’s no one telling you this relationship is going to make you happy. When you decide to start a business or move to a new country or eat waffles instead of pancakes for breakfast, there’s no way of knowing — for certain — if what you’re doing is “right” or not.

    Developing the ability to simply do things for no other reason than curiosity or interest or hell, even boredom — the ability to do things with no expectation for result or accolade or productivity or fanfare — will train you to better make these big ambiguous life decisions. It will train you to simply start on something without knowing where in the hell it’s going.

    [Read more…]

Safal Niveshak Stream – October 22, 2016

Some nice stuff we are reading, watching, and observing at the start of this weekend…

Investing/Stock Market

  • Jason Zweig, The Wall Street Journal’s investing columnist, in an interview with Philip Tetlock, the co-author of “Superforecasting: The Art and Science of Prediction,” explore why amateurs can actually be better than experts at predicting the future, and what the experts can learn from it…

    One reason is that experts sometimes know too much. I was talking once to John McLaughlin, former director of the CIA, about the end of the Cold War period, and he was remarking that the analysts who were slowest to recognize that East Germany was disintegrating were the people who had been on the case for 20 years.

    It was the newbies coming in who got it pretty quickly. And there’s a lot of psychological evidence that attests to the power of preconceptions to grip us and make it hard for us to be timely belief updaters. So sometimes knowledge is actually an impediment. Another big factor is that there is a large amount of uncertainty in the world. So no matter how smart you are, it isn’t going to give you a lot of traction.

    [Read more…]

Safal Niveshak Stream – October 19, 2016

Some nice stuff we are reading, watching, and observing during the middle of this week…

Investing/Stock Market

  • The long run is just a collection of short runs, writes Morgan Housel…

    …value is ultimately created in the long run. That’s where scale takes off and compounding works its magic – over years and decades, not months and weeks.

    The key is recognizing that the long run is just a collection of short runs, and capturing long-term growth means managing the short run effectively enough to ensure you can stick around for a long time.

  • In 2011, Seth Klarman explained the psychology necessary to be a good value investor, in an interview that he did with Charlie Rose. In this interview, Klarman says, “Investing is the intersection of Economics and Psychology.” He added…

    The economics, the valuation of a business is not that hard. The psychology, how much do you buy, do you buy at this price, do you wait for a lower price, what do you do when it looks like the world might end. Those things are harder.

    [Read more…]

Safal Niveshak Stream – October 15, 2016

Some amazing stuff we are reading, watching, and observing at this start of this weekend…

Investing/Stock Market

  • If I could reveal just one secret of sensible, successful investing (which isn’t a secret, by the way), it would be…

    Secret of sensible, successful investing
  • Buying stocks when the market collapses is far harder to do than to imagine. But the great economist — and equally great investor — John Maynard Keynes waded into the wake of the Great Crash of 1929, when US stocks fell by more than 80% from peak to trough. His experience should teach all investors the importance of preparation, courage and patience

    Keynes understood, as did his contemporary, the American value investor Benjamin Graham, that bear markets are so unpredictable that reliably sidestepping them is nearly impossible — and that the pain of losing money is nearly unbearable.

    Still, Keynes knew, barging into bear markets to buy, rather than trying to sidestep them, is the way to prevail. Since, over the long run, stocks tend to go up more than they go down, one of the greatest advantages an investor can have is the gumption to buy stocks aggressively in falling markets.

    [Read more…]