Rakesh Jhunjhunwala's Real CAGR

Discussion in 'Must-Read Interviews, Articles & News Items' started by Vidhi Khanna, Mar 31, 2015.

  1. Vidhi Khanna

    Vidhi Khanna Active Member Staff Member

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    I have always wondered about the real CAGR achieved by the big investors. Stories are created and floated in the market to make their achievements look much bigger than what they actually are. Rakesh Jhunjhunwala is unarguably the most successful investor on Dalal Street. I was always interested in knowing his real CAGR. The problem is that the stories created around him make it almost impossible to gauge that. It requires some glimpses into his early years as an investor/trader to know the approximate CAGR achieved by him.

    As per the fable, he came to Dalal Street with 5000 Rs in 1985. And now considering that his net worth is close to 2 billion dollars(12000 crores), the CAGR achieved will be closer to 77%. For a 30 year period, achieving a 77% CAGR looks almost impossible, and I never bought into the story.

    .......

    http://gyankibaaten.blogspot.in/2015/03/rakesh-jhunjhunwala-s-real-cagr.html
     
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  2. w4wealth

    w4wealth Well-Known Member

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    The truth is that when rj started in 1985 he had 5000 rs in his hand. he borrowed 15-20 lakhs and started investing. so his real capital is 15 lakhs and not 5000 rs.so 77% cagr is almost impossible.
    rj s real cagr is much ower than 77%
     
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  3. darth

    darth Active Member

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    Son of an Incometax Commissioner may have started with capital of Rs 5000/- or 15lacs debt, but can anybody fix a value to the inside info he had during those initial days?
     
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  4. w4wealth

    w4wealth Well-Known Member

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    i dont think so dear darth because he is ,from then when he started investing, a open book who had no secrets. in his initial days in 1985 he discussed his favourite investment ideas with everybody, even people he met on road.but noone took it serious or seemed to believe him. so there is no element of insider info in his success. it is sheer passion and hardwork.
     
  5. darth

    darth Active Member

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    I wont spend effort to try and convince you (or others) otherwise.

    Btw did you know about this background of his
     
  6. BombayBoy

    BombayBoy Well-Known Member

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    Will people talk about their insider info in the public or on record? No. Buffett is no saint either. For this very reason, I like Carl Icahn and Bill Ackerman.

    Information is the priciest commodity.

    And the India of even 1980s was dramatically different from what we are today. Doing the same now even for the old retail guys who have/had shares from the public offerings is like an Everest expedition.
     
    Last edited: Jan 2, 2016
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  7. darth

    darth Active Member

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    I dont think the now billionaire RJ needs to snoop around for inside info. He would have many a managements eating out of hands. Otherwise the old adage ' money attracts money' holds 100%
     
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  8. BombayBoy

    BombayBoy Well-Known Member

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    nah he just needs fans to dig out his latest trades and send his latest buys to upper circuits

    Very unfair to blame RJ alone. It has become the modus operandi. Build up your positions, create a story, The Professor sells it too, call it "value" investing, gullible retail "investors" jump in. Keep riding.
     
    Last edited: Dec 20, 2015
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  9. darth

    darth Active Member

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    That holds true for most but currently i think RJ. has gone past this game ( no deliberate attempt to sell a stock pick). Can't say this for the other so called 'value investors' floating around who thrive on the modus operandi you cite
     
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  10. w4wealth

    w4wealth Well-Known Member

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    yes i know tht his father was an income tax officer, that time he was working in bombay.

    once i calculated his real cagr bcoz of curiosity and it was around 49% if my calculation was right. i think that in 1985 the sensex was at 400. it became 30000. even index performed enourmously. so i dont believe that he used any such info .
     
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  11. darth

    darth Active Member

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    Income tax commissioner and not officer and at one time in charge of the companies circle....




    Many Thousands of Investors then exist even now..... sensex was at 400 and it became 30000 for them too.... I suppose there are many thousand 'hidden and shy' of bbillionaires ( in usd terms) also
     
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  12. BombayBoy

    BombayBoy Well-Known Member

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    the question isn't about the CAGR or success of RJ as an investor/trader

    if you think there's no insider info - look up the story of Rajat Gupta, MD of McKinsey - living the American Dream, how he helped his friend Raj Rajaratnam, a billionaire and high flying fund manager of Galleon fame

    Bernie Madoff is another example, not of insider trading, but where he accepted all that he was running was a "Ponzi scheme"
     
    Last edited: Jan 18, 2016
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  13. w4wealth

    w4wealth Well-Known Member

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    rakesh jhunjhunwala became enourmously suuccesful because he is fearless when it comes to highly leveraged trades . once he had as high as 40% debt on his portfolio. but now he has much lower 5% debt. i also got info that he made close to 700 crores in narendra modi bull run in trading.
     
    Last edited: Jan 17, 2016
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