September 16, 2025
Mohnish-Pabrai
Mohnish Pabrai has revealed how he lost a colossal fortune in the great stock market crash of 2008. However, he kept his head and regained his entire fortune. He has also spelt out the Ten Commandments which will enable us also to rake in a fortune from stocks if we obediently follow them
Mohnish Pabrai has revealed how he lost a colossal fortune in the great stock market crash of 2008. However, he kept his head and regained his entire fortune. He has also spelt out the Ten Commandments which will enable us also to rake in a fortune from stocks if we obediently follow them




Bears sabotage Futures & Options (F&O) & cause massive losses to traders

Yesterday, 17th October 2018, the Bears hatched yet another devious plan to cripple Dalal Street.

At 1500 hours IST, they sabotaged the NOW terminal which is used by elite traders to execute buy and sell orders for futures and options.

The system hanged with the result that traders who had taken positions could not exit in time.

Even the stop loss mechanism which normally bails out traders from trouble was paralyzed.

Naturally, traders lost colossal sums of money and were seen weeping copious tears on the steps of Jeejeebhoy Towers.

Bulls also suffer massive losses

The Bulls were also at the receiving end of the deadly Bear attack.

The Nifty Midcap 100 Index plunged a massive 2.26%, wiping out fortunes in the blink of an eye.





Blood bath in NBFC Stocks

NBFC stocks were the worst affected by the meltdown.

Stock Loss (%)
DHFL 12.22
Edelweiss 10
Piramal Enterprises 10
M&M Financial 8.12
L&T Finance 8
Repco Home Finance 7.86
Reliance Capital 7.35
Cholamandalam 6.74
Shriram Transport 6.18
PNB Housing Finance 6.13
Manappuram Finance 4.82

It is baffling as to why NBFC stocks are so vulnerable to Bear attacks given that two eminent Billionaires, Ajay Piramal and Nirmal Jain, have already issued clean chits that all is well with the sector and there are no liquidity problems.

However, according to some knowledgeable experts, the golden days of NBFCs are now over and the premium valuations at which they are presently quoting is not sustainable.

My Networth Plunged from $80 Million to $18 Million: Mohnish Pabrai

Mohnish Pabrai realized that the panic level amongst novice investors has now reached dangerous levels.

People are running helter-skelter, completely distraught at the merciless destruction of their wealth.

He rushed to counsel them.

At the bottom of the financial crisis, my net worth was down to $18 Million. It was a huge drop from the peak of $80 Million,” he said.

Mohnish chose his words carefully and spoke in a deliberate and slow tone, knowing he has to be understandable to even the rawest of novice.

He was addressing distinguished academicians and students at the elite Boston College.





Convert adversity into opportunity

Mohnish explained that he is “differently wired” as compared to other investors.

While other investors were bemoaning their fate during the great stock market crash of 2008, Mohnish was rubbing his hands with glee.

When I was going through the financial crisis, what was exciting was just the sheer number of investment opportunities. While your portfolio is burning and crashing, you are seeing mouth-watering investment ideas,” he said.

I sold cheap stocks to buy cheaper stocks,” he added with a chuckle.

Mohnish explained that the entire commodity sector had crashed and stocks were available at such bargain basement prices, that he knew he would be able to effortlessly rake in at least 5x multibagger gains from them.

However, because he did not have the time to study their individual merits, he bought the commodity stocks in a random manner and as a “basket”.

Needless to say, when the crisis blew over, Mohnish had not only recovered his losses but had raked in massive truckloads of gains.

Not a single one was a loser. Almost every single one went up four, five times,” Mohnish said with understandable pride in his voice.

Stay in senses and keep chopping wood

Mohnish also offered philosophical advice to investors.

He explained that he had learnt from his father that during times of crisis, one must “keep senses about” and “keep chopping wood and move ahead”.

We must understand that present circumstances never last. If you are having a really good time in life, that’s not going to last. If you are having a really bad time in life, that’s also not going to last,” he said.

You must have confidence when you are at the bottom of life that it is going to get better,” he added with a soothing smile.

Top Ten Commandments for success in stocks

At the end, Mohnish issued Ten Commandments that all managements and investors have to faithfully follow.

These commandments are the following:

1. Thou shall not skim off the top [fees]

2. Thou shall not have an investment team

3. Thou shall accept that thou shall be wrong at least one-third of the time

4. Thou shall look for hidden PE of 1 stocks

5. Thou shall never use Excel

6. Thou shall always have a rope to climb out of the deepest well

7. Thou shall be singularly focused

8. Thou shall never short a stock

9. Thou shall not introduce leverage

10. Thou shall be a shameless cloner

It is notable that Mohnish has now made it compulsory for us to become “shameless cloners“, which we have already been doing since time immemorial.

Light at the end of the tunnel?

Mohnish’s advice that we should take advantage of adversity in the markets to tuck into stocks at bargain basement prices makes a lot of sense.

In fact, according to Mark Minervini, an authority on Futures and Options and author of a best seller named ‘Trade Like a Stock Market Wizard: How to Achieve Super Performance in Stocks in Any Market‘, the markets are in deeply oversold territory and a sharp bounce back is expected soon.

This theory is corroborated by Peter Brandt, a veteran trader and also an authority on the subject.

So, it is explicit that it we can brave the storm now, we will also be able to take home massive gains and become millionaires, the way Mohnish did in 2008!








11 thoughts on “My Networth Plunged But I Still Kept My Head: Mohnish Pabrai Reveals Top 10 Commandments For Success In Stock Market

  1. Normal ordinary investor like me should not go down beyond top 100 stocks and even from that don’t invest in PSU stocks. For small and mid cap stocks invest only maximum 10% in each category that too through mutual funds and only if you are investing for 10 years or more. Those who don’t understand stock market should only invest in hybrid aggressive funds.

    1. why do investors get so scared during bears, this is the time to invest or if you are already invested forget about markets and divert your attention to other hobbies….I would personally never park in largecap when midcaps are available on big sale….50 to 70% off…buy when there is blood in the street,worst thing to do is buy FD’S or Gold/real estate…markets always come back

      1. Many of Indian small and Indian mid caps have corporate governance issues, it is difficult for an ordinary investor to find it out, better bear some mutual fund fee for safety in mid and small universe, most of investors burn their figures while speculating (without proper information you can not claim that as investment) in these stocks. Many of such third grade stocks has gone up by 5 to 10 times, just 40 to 50% correction for them is just starting phase, many of them may go down by 80 to 95% and majority of them may never recover.

    1. Dont do complex financial modeling and projections. If the basic numbers (PE, P/BV, ROCE etc.) dont make sense, dont invest.

      With financial modeling, we can come up with widely different valuations depending on assumptions.

      In his book he also states around the lines that if the investment hypothesis is not very brief, then we dont understand it well enough.

  2. If you are stupid enough to write calls on open high and trending lower market, ofcourse you will face losses. It’s not called a bear attack, it’s called stupidity. And it was opportunities for people who were nimble enough to enter into the right side of the market.

  3. Trading in the direction of trend is profitable. But the issue with option writers on the day of expiry is, they think market will most probably remain in range and max pain will work.
    But market can do whatever it want and whenever it want.
    PS: Even i have lost 3% due to put writing, expecting market to be in a range.

    1. This is similar to the current rage new age management formula that “you should fail to succeed”. Similar to “your portfolio must be down from 80 to 20, then only you should intervene and restructure it”. This kind of theory is nowadays is taught even in best B-Schools (IIMs), which tells that “you must fail to succeed”. Not able to succeed. If you are trying to take the stigma out of some “failure”, then, it’s ok, but, if you are therorizing to young B-School graduates that “you must fail to succeed”, then, I think there is something wrong with the theory itself.

  4. When you invest in a stock like Rain Industries, owned by Mohnish Pabrai and Dolly Khanna. What happens is we forget that they invested at Rs.35, and can afford to have 1000% percent cut, When guys like me have a 30% cut being brave is committing suicide. So, follow the “masters” blindly if you want to retire rich, not necessarily in the next 5 years. You may become homeless, they won’t.

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