Investment journey of a late starter

On selling

I have accidentally invested some money in the past, more of luck and circumstances than any meaningful understanding of businesses and market.

So if i discount those paltry investments, i am a late starter as well because its only now that i am trying to make sense of this all, time permitting.

Few observations about selling which obviously is very important. I hardly ever sold anything in the past so i can somewhat see which direction all those investments went in all these years.

All in all i am happier sitting on good investments because i have benefited from it in a span of 14 years. I saw my investments rise, fall, rise again and fall again but the threshold or base has always been going up. After few hundred percentage, it hardly matters if a stock falls as it never crashes to the levels you bought it at, not from a mile. (And not in the last 14 years from the universe that i owned, say, decent stocks).

The other day i was reading about someone’s investments here, he owned Rajratan for years and got out after multiplying his money 9x. I noted that after his exit at around 450 INR or so, the stock reached 1500 and now has fallen to 900 levels.

At 9X 10X 15X it’s difficult for even a war to dent your principal.

Second example is TaMo which i bought at throw away amounts in 2009 and saw it rising to 3 figures and sold it. Today i know that it was a mistake even if i made some money.

From 2020-21 when many of us got interested in equities in a meaningful way every single stock that i sold turned out to be a mistake. Including some of the consensus-trash. I bought Bhel at 28 and sold at 55 and look where it is now And i thought if there was one stock which i could sell, it was supposed be Bhel !

Earlier i looked at my investments after a gap of few years in 2014 and then straight in 2020, this ‘sitting pretty’ being the sole reason why i made profits…lot to be said about doing nothing. No wonder there is a Coffee Can available for this sort of thing !

Finally, and most important point for me is that things are changing in India and globally, Tech, EV, Climate etc. Therefore i feel many of our old leaders will transform into all new and fresh entities. Companies that were just sitting there for years suddenly have a new purpose. Old names at large M Cap have all of a sudden become all new businesses. So much capex for a near U-turn for so many businesses taking place currently.

It is in this context that i feel sitting pretty on my stocks for a long time will be much more meaningful now than it was earlier. Some of the businesses under such transformation, even if they are bigger companies, may behave exactly like quintessential small cap wealth creation.

Happy holidays to everyone.

PS: This post may not be true for everyone and may have selection-bias