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basant
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   Posted: 17/Jan/2010 at 11:27am |
Originally posted by 9StockPortfolio
@Basantji,
Perfect description. Now Big bets using own money or borrowed is the second question. 1)If the person have enough money to bet on that chance, then no problem, but 2) If using available information(Interest rates & all) one can bet using some leverage, provided the returns from the workout are greater than the interest expenses and remaining profit worth millions.
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I had bet with borrowed money though had some of my own also but at that time Pantaloon and TV18 just seemed to be the big opportunity. But here one size does not fit all. Unless the idea is really compelling in terms of gains one should not bet with borrowed money. Borrowing for quiet ideas can be done if the yield makes up for most of the interest costs. This is what Rakesh Jhnjhunwala did in the late 90's when he bet on Engineers India; BEL; BEML; GE Shipping etc.
Originally posted by 9StockPortfolio
I find no difference in this & appropriate borrowing for that Chance.
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Very sound argument but promoters do not get stopped out for margin calls and are not focussed on the quote machine.
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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basant
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Posted: 17/Jan/2010 at 11:29am |
Peter Lynch Boss hai bhai! 
Originally posted by vincent
3)And at what point does one decide to "work for yourself" and use dividend income to run the gas,choola et al at home?
I recall reading in Beating the street by Peter Lynch, an example of living on investment income with a portfolio comprised of 100% equities. I wonder if Mr. Basant was inspired after reading this chapter?
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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praveen
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Posted: 18/Jan/2010 at 12:17pm |
Originally posted by basant
...... Borrowing for quiet ideas can be done if the yield makes up for most of the interest costs. This is what Rakesh Jhnjhunwala did in the late 90's when he bet on Engineers India; BEL; BEML; GE Shipping etc.....
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I wanted to do something similar in Jan-Mar but couldn't do it becuase the cost of funds was too high for my comfort.
Basantji,
Any thoughts on where to get leverage from at an acceptable cost of funds apart from using F&O?
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The quest for knowledge is a never ending Journey
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tigershark
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Posted: 18/Jan/2010 at 1:12pm |
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sucsess in mkts is never a planned effort cos what was sucsessful shall be known only in hindsight, but the ability to understand and ride out the business thru its growth phase does require some planning ,the planning of doing nothing , getting off the bandwagon also does require some skill not planning and skill to ride and jump off comes only thru experience
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understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things
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Monkey
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Posted: 18/Jan/2010 at 1:30pm |
Originally posted by prabhakarkudva
Thanks monk ji.But the real question is how does one go about chasing that one crore in the first place?Does it involve risking your entire networth on some great opportunity atleast once or one needs to use leverage or is it just plain chance? |
I am doing it in traditional way of saving as much as possible from my salary income and keep it invested for long time to allow compounding.
I do not see any risk in diversified portfolio invested for long term in Indian market. I consider volatility as different animal than risk. For me, risk is defined as very high probability of earning returns less than bank FD or post office schemes over a long period of time. say 8 - 10 years, whereas volatility is defined as fluctuations of temporary durations, say 1 - 2 years, however wild it may be, in market value of portfolio. I can digest volatility quite well based on my experience of last two years.
Leverage acts like amplifier on both ways. If you get it right you reach your goal quickly and if you get it wrong, it will take more time than normal. I am not using leverage as of now. But, I am thinking on going long Nifty future and keep revolving it on expiry or buying long dated Nifty calls if and only if market gives a big time opportunity, say 1/3 correction from current levels.
Importance of chance in life can not be ignored. However, few have ability to recognise it and act big way on it. As of now I do not consider myself having such ability but I do aspire for the same.
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prabhakarkudva
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Posted: 18/Jan/2010 at 1:34pm |
Thanks monk ji.
PS: Tigershark ji,your inbox seems to be full and yes it is me.
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Take your chances and keep them in a box until a quieter time.
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tigershark
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Posted: 18/Jan/2010 at 1:58pm |
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prabhakar in 93-94 i never knew infy will becom so big ! the planning came in 2000! i have sent yu a friend request at least one ted member knows how yu look and yu look good
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understanding both the power of compound return and the difficulty getting it is the heart and soul of understanding a lot of things
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prabhakarkudva
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Posted: 18/Jan/2010 at 2:06pm |
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Ha ha thanks for the nice words tigershark ji(I am not sure if i am allowed to divulge your real name).i will add you once i get home.Facebook is blocked in the office for obvious reasons.Also can you elaborate a little on the planning that you did after 2000?
PS:BTW i've been to Goa only once and i loved that place.
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Take your chances and keep them in a box until a quieter time.
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