The stock does not know you own it

An image search of the title of this post will tell you Warren Buffett said it, just like most profound things on investing and life. Except, he did not.

The stock does not know you own it, is, in fact, from the book: The Money Game by George Goodman, written under the illustrious pen name of Adam Smith.

This single line ‘The stock does not know you own it,” if internalised, is one of the most potent investing concepts

Identities or Beliefs

From sports teams we enthusiastically support, to the kind of consumers we are, our religion, and our political affiliation, we all carry around multiple identities. Things we feel deeply about and form a part of us.

But this can be a problem when it comes to investing. Here’s why, as investors, we should stay away from identities and instead examine our core investing beliefs.

Should you invest at market highs?

This post was first published on Indian markets have been making new highs lately. Naturally, the most frequent question doing the rounds is: Should you invest at market highs? The question tends to be phrased as “Isn’t it just plain dumb to be investing at market highs? Should I a) stop investing more and … Read more

What Cathie Wood gets right

So, Cathie Wood, in a recent Bloomberg interview, predicted Bitcoin will be $1 Million by 2030.

For reference, as of writing, BTC is $16.5k. So, about a 6000% increase from here.

Like with most things she says, a reaction-frenzy follows. It makes you wonder why a fund manager, down over 60% for the year, would make such an outrageous prediction. Why not a sedate $100K, which would still mean a 600% increase?

The BTC $1M prediction makes perfect sense when you unpack Ark’s marketing strategy.

The futility of analyst recommendations

We analysed over 2,000 analyst recommendations (upgrades and downgrades) made by institutional equity analysts over the last ten years for the 50 Nifty stocks. We measured the 60-day return on the stock after the recommendation to see how those analyst recommendations fared.

Here’s what we found

Keep your investing identity small

Instead of thinking of our chosen investment style as a fortress to be defended from attacks at all costs, maybe think of it as an idyllic picnic spot. We happened to find one on a stroll, put down our blanket, and enjoyed a leisurely lunch. We will be ready to move on because we know we can return. But for the duration we’re there, we probably won’t be sending up flares announcing its location to the world.

Let’s talk investing with Raunak Onkar

In the ‘Let’s talk investing‘ series, I spoke with Raunak Onkar, head of Research, and Fund Manager at PPFAS Mutual Fund. In this series, I write about my conversations with investment practitioners, people with real-world investment decision-making experience. My objective in these conversations is to understand their investment philosophy and process, to demystify, at least … Read more