Archives for September 2017

[Read more…] about StockTalk (September 2017)

Naresh is a Bachelor of Engineering and a Certified Risk Manager. He has a global consulting experience in Investment Banking, Risk Management, Trading, and Compliance. He also has Consulting experience in global Capital Markets. Prior to starting off as a full-time investor in 2014, Naresh headed the Global Risk and Compliance Consulting unit at the Indian IT major, TCS.

Safal Niveshak (SN): Naresh, could you tell us a little about your background and journey, how you got into value investing?

Naresh Katariya (NK): While I qualified as an engineer, I realized early that my interest was in equity markets. I was working in the broking industry for a few years. But my primary interest in equities arose while I travelled globally and worked on consulting projects for stock exchanges, depositories and investment banks. My fifteen years in TCS, in fact, provided me the perfect platform to observe how capital markets worked across the globe. I used to be filled with amazement working at exchanges/depositories in New York, Zurich, Singapore, Frankfurt, London etc. I was an equity investor in Indian markets throughout this period, building capital as well as honing my investment skills. In 2014, encouraged by a very smart investor from Hyderabad (who was my client during my broking days and now a family friend), I took the plunge into full-time value investing.

[Read more…] about InvestorInsights: Naresh Katariya

The true story of how a hedge fund, run by a team of super smart Nobel laureates, tried to out think the market and failed. It’s a remarkably instructive tale of how intelligence, when corrupted by arrogance and hubris, eventually leads to disasters.

Success, they say, leaves clues. So does failure. Unfortunately, the world focuses too much on learning only from successes. Success alone leaves the learning equation incomplete.

Identifying patterns is the key to drawing useful lessons from the past. Success patterns are just one part. The patterns left by failure are the remaining part of the puzzle. To succeed, one has to study both. Learning ‘what to do’ from success patterns and learning ‘what to avoid’ from failure patterns.

A person trying to get ahead in the world, with no will to study the failures, is akin to the proverbial one-legged man who is trying to score points in an ass-kicking contest.

[Read more…] about BookWorm: When Genius Failed

Numeracy is the ability to intuitively understand numbers, their magnitude, their relationships, and how they are affected by operations. Unfortunately, innumeracy is far more widespread and socially accepted than illiteracy. To avoid poor decisions in money and investments it’s supremely important that one understands the language of numbers and develops a sense of probability.

In the 2.5 million years of human evolutionary history, homo sapiens never had to deal with numbers until about 12,000 years ago when complex societies began to appear. In the wake of the Agricultural Revolution, a completely new type of information became vital – numbers.

A critical step was made sometime before the ninth century AD, when a new partial script was invented, one that could store and process mathematical data with unprecedented efficiency. This partial script was composed of ten signs, representing the numbers from 0 to 9 – the Arabic numerals. When several other signs were later added to the Arab numerals (such as the signs for addition, subtraction and multiplication), the basis of modern mathematical notation came into being.

Unfortunately, human brain never got a chance to adapt to storing and processing numbers. Yet the development of modern society is firmly standing on the foundation of mathematical principles. In fact, until last few centuries, the common man didn’t have to deal with much mathematics. Anything beyond simple addition or subtraction was reserved for scientists and scholars who indulged in advance concepts for their own amusement.

[Read more…] about Behaviouronomics: Innumeracy