Simple Investing

Self Learning continues – Paid significant tuition fees this time

Above was in Oct 22…6 months hence, in between I kept adding Nykaa in very small quantities, so all this while in the fall it maintained an around 1% of my Portfolio as a “Hope” bet…only to finally make a complete exit today at loss of around 50%

It was painful. Booked loss of around 1% of portfolio…largest so far… as I am hardly a quick seller and tend to wait for company/business to recover rather than book losses…

I replaced it mostly with a dull, boring, traditional HDFC AMC (added around 51% to my already existing holding).

Also, took small exposure to new Hope bets in traditional businesses – Max India (Healthcare related) & Nelco (Satellite Communication) & added negligible quantity to Spencer Retail (Traditional Retail). I had been eyeing them since many months and they are also significantly down from their respective peaks, so made the switch.

What I learned about myself here is –

1. I started my investing journey with One up on wall street by Peter Lynch – Buy what you see etc. I am glad I did that but over last decade, my mistake had been that I did not take time to read Graham’s Intelligent Investor. – Margin of Safety . Although not reading it right at beginning did help me somewhat as otherwise I would not have even looked at some companies which did really well for me – that’s probably because we do not understand complete essence in the book. So, with just few pages into it, I could so very well relate to the “narratives” hype etc. etc.

2. I made a mistake of paying too high for an ordinary business which looked extra ordinary because of the narrative & timing of the IPO.

3. Although decent time in Market prior to IPO and even later, I made mistake of getting trapped in the entire ecosystem of New Age businesses and next decade(s) belong to them blah blah.

4. I sold late and kept adding on falls. Saving’s grace, did not exceed total holding at 2% of portfolio by cost.

Conclusion and Oath:

1. Never ever again fall for any “Narratives” , “New businesses/New Age companies” or any other hype/ideas/wave of change.

2. They may do well but it will not be a cakewalk.

3. Opportunities will be immense for incumbents as well.

4. No wave of change would go in straight line whatever be the narrative

Precisely that’s why chose to replace it with the most boring company from the best possible Management & sector in extreme distress at the moment – HDFC AMC.

Disclosure: Above is not a buy/sell recommendation in any of the stock names mentioned. I am invested & hence extremely biased. Post is only for academic purposes and learning. I can be wrong in all my assessments. I am not eligible to give any advice.