1. You cannot make money on borrowed knowledge: A young interviewer was interviewing RJ on a business channel. As the interview was winding up, she posed a question to him, ‘I cannot let you go till you give me tips for making money on stock market?’ RJ gave her a benign look & said, ‘Young lady I can give you a tip for making money but you cannot make money on borrowed knowledge’. The lady nodded at RJ & closed the show! Lesson for you: To be successful, you should attempt to understand the ‘Why’ of things instead of just knowing ‘how’ of things.
2. You cannot join all the parties in town: These days, many stock prices are touching their 52-week highs. Seeing this would make many of you feel miserable at the lost chances! Lesson for you: It is humanly impossible to join all parties in town; a wise person chooses with prudence the party she wishes to join & thereafter stays invested in it for long periods of time!
3. Hold tight on to your investment: You should give your investment time to mature because it is only over time that stock market rewards ‘patient’ investor.
4. Learn from your mistakes. Learn to take a loss: No matter how brilliant you are in identifying stocks which lay golden eggs; there will be occasions when you would end up picking a dud! Do not fret – learn from your mistakes & most importantly learn to take a loss!
5. Inculcate an investor’s, not a trader’s mindset: An investor measures his investment in years not days. While a trader measures his investment in days! Bottom line: Patience is a virtue & stock market bountifully rewards patient investors.
6. Compounding is the 7th wonder of the world: Remember that compounding is not a get rich scheme. It takes time to take deliver results!
7. Invest in a business, not a company: Remember to invest in a business, not in a company! Let me get Warren Buffet to share his thought on this – if you are right about the business, you don’t have to worry about anything else.
Do you agree with the investment philosophy of Rakesh Jhunjhunwala? Do share your investment philosophy & make the discussion richer.
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Comments
Sourab Kadadi
Sir, Seems to be a mistake in 6th point....i.e, Compounding is the 8th wonder of the world.
11 Dec 2017, 06.42 PM