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Are you buying stocks after a positive event occurs?

posted Dec 3, 2019, 12:31 AM by Harshul Vohra

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Catalysts are events ( macro or micro)that unlock market value in a company. For eg. earnings report, currency depreciation, change of management, new products or technology, global triggers, etc. Seth Klarman answers a very important question of whether to buy a stock after or before a catalyst triggers? He says as a value investor its not easy to buy on the upside and sell on the downside. Human emotions always acts as an obstruction. So buying before a catalyst triggers is a good idea.
Also larger the size of the fund, it becomes essential to buy before the trigger.😇

Are you minimising drawdowns on your investments?

posted Nov 26, 2019, 3:08 AM by Harshul Vohra

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This quote by Peter L. Bernstein “Survival is the only road to riches” is very important in investing. He says Wealth is like your children — the primary link between your present and the future. You should try to think about it in the same way. You want your children to have freedom but you also want them to be good people who can take care of themselves. You don’t want to blow it, because you don’t get a second chance. When you invest, it’s not your wealth today, but it’s your future that you’re really managing.
The role of a money manager isn’t maximising returns but optimising them with respect to risks. Drawdowns should be minimised even at the cost of sacrificing some returns. Risk-taking is an inevitable ingredient in investing, and in life, but never take a risk you do not have to take. 😇

Value investors think differently than the rest of the market.

posted Nov 11, 2019, 4:27 AM by Harshul Vohra

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Differentiation is among the key ingredients to succeed in business and investing.
To be successful in your business, you need to offer a product that differs from the competition in a way that clients recognise as added value.
Similarly in investing if you want to outperform the market as an investor, the first thing you need to do is something different from all other investors. Every great investment requires a skill which is ability to assess risks and opportunities differently than others.😇

Repetition Compulsion: Human behaviour repeats over and over again.

posted Nov 11, 2019, 3:49 AM by Harshul Vohra   [ updated Nov 11, 2019, 3:53 AM ]

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This quote by Mark Twain seeks to harness life’s most profound truth, that time only moves in one direction and that is forward but events that are similar do happen again.
In the context of the financial markets, though the amplitude, frequency, speed of the fluctuations, duration of the cycle varies from one another. What rhymes(repeats) in a bull market is:
High level of optimism & Low level of risk aversion.😇

What is value investing?

posted Nov 7, 2019, 3:35 AM by Harshul Vohra

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This quote from howard marks inspire us to identify great companies out of the descent ones. We undoubtedly believe that superior results don't come from buying high quality assets, but from buying assets regardless of quality for less than their worth. Its essential to understand the difference between buying good things and buying things well.
A low purchase price not only creates the potential for gain, it also limits the downside risk. The bigger the discount from fair value, the greater the "margin of safety" an investment provides. 😇

Cash itself is an asset class.

posted Nov 7, 2019, 3:18 AM by Harshul Vohra

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Cash as an Optionality is one of the best learning from Mr.Buffett.
An Investor's Asset Allocation decisions are not simply between earning less in cash and earning more in bonds or stocks.
The key question here becomes: "How much can the cash earn if I have it when I need it to buy other assets that are cheap, versus the upfront cost of holding it? 😇

What kind of investor are you?

posted Nov 5, 2019, 11:21 PM by Harshul Vohra   [ updated Nov 5, 2019, 11:21 PM ]

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This post presents the most important message from the book “THE INTELLIGENT INVESTOR” by Benjamin Graham
The message is that your investment strategy entirely depends on what kind of investor you are : Defensive (Passive) or Aggresive (Enterprising).
Aggresive means continuously researching, selecting and monitoring the “best” available stocks. This takes time and energy.
Defensive means creating a permanent portfolio that runs on autopilot and requires no further time or effort.
TrendlineZ makes it everything DEFENSIVE for you. 😇

Investing is a long term proposition.

posted Nov 5, 2019, 11:00 PM by Harshul Vohra   [ updated Nov 5, 2019, 11:00 PM ]

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We always want things to happen quick. We want to accomplish everything we could possibly think of in a year — because a year is so long, right?⠀
No. If we have the attitude of thinking how much we can accomplish in the long term bit by bit, we can accomplish a lot more with ease. Consistency is all that matters !!
Similarly in investing, executing a well researched plan consistently over a period of time will generate superior returns in long term. 😇

Business Fragility

posted Nov 5, 2019, 2:57 AM by Harshul Vohra   [ updated Nov 5, 2019, 2:57 AM ]

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Fragility can be a structural weakness in a business model that can decimate the earning power of that business and its value. Rather than predicting an event that may or may not harm it, we try to identify those structural characteristics, quantify them and value it appropriately. 😇😇

Volatility is not to be feared.

posted Nov 5, 2019, 1:29 AM by Harshul Vohra   [ updated Nov 5, 2019, 1:29 AM ]

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Behavioural studies shows that stocks often sell off more than is warranted due to the over-reaction of investors to a particular event. Hence, it is not surprising that the same stocks can rebound once fundamental factors are considered more carefully. A common characteristic of many of the stocks that we buy is that everyone hates them. Part of the future is unknown but there are these instances of high volatility where you can get favourable risk/rewards.
Thus volatility is not to be feared, but to be embraced.😇

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