Investing mistakes and learnings
•
1 j'aime•251 vues
Presentation for Mistakes and learnings from Investing by Mr. Amit Kumar Gupta, Fund manager for Adroit PMS
Recommandé
Recommandé
Contenu connexe
Tendances
Tendances (20)
Similaire à Investing mistakes and learnings
Similaire à Investing mistakes and learnings (20)
Plus de Adroit Financial Services Pvt. Ltd.
Plus de Adroit Financial Services Pvt. Ltd. (11)
Dernier
Dernier (20)
Investing mistakes and learnings
- 1. 1 Amit Kumar Gupta 10-Oct-2020 Mistakes and learnings from Investing
- 2. Amit Kumar Gupta 2 . @amitgupta0310 • Worked as a business consultant with leading MNCs and start-ups over diverse fields of Healthcare, Education and Retail. • Over a decade experience in investment analysis and portfolio management. • Responsible for setting up the research desk at Adroit Financial across asset classes of equity, currency and commodity • Currently acts as a fund manager for PMS. • He is an engineering graduate of Delhi University and earned his MBA in Finance & Strategy from QUT, Brisbane Amit Kumar Gupta amitgupta0310
- 3. 3 Standard Disclaimer • Any stocks discussed during this presentation is not investment advice. It is done purely for illustrative purposes. Please consider a financial advisor before making any investment decision • My employer, Adroit financial services Pvt. Ltd is both a SEBI registered Research analyst and Portfolio manager.
- 4. 4Amit Kumar Gupta Types of market players
- 5. Reference : Dirty Picture (2011) 5 Entertainment seekers Seek some kick, sense of adventure Deploy miniscule (usually less than 2%) of their networth in equity markets. Winning or loosing will not make any difference to their lifestyle Most active during bull phase and least active during bear phase Returns – usually less than bank deposits or even less
- 6. 6 Casino Players… Reference : Sacred Games (Netflix) Buying equity is like buying lottery ticket Allocate fixed amount to equities in the hope of hitting jackpot one day Mostly bet on penny or low value stocks Understand the risks associated but still take the punt Usually end up losing 50-100% of the capital which obviously they don’t mind
- 7. 7 Investors… Buying equities means buying underlying business, feel like business owners Substantial exposure to equity investments as compared to their net worth Usually end up making wealth from equities Usually tend to be miniscule % of the actual investors
- 8. HOW MONEY WORKS Become Employed • Someone pays you to work for them. • You exchange your time and effort for an income. • You don’t work – you do not get paid. Simple. Start Business or Invest in them • You take your money and you save or invest it. • You become an owner of something that you hope increases in value over time. When you need your money back, you sell it, hoping someone else will pay you more for it.
- 9. 9 Money doesn’t grow on trees… • At 20, won Olympic Gold in Athens in 2004 • Between 2004-16, won 11 more O-Medals • Doping suspensions put out of game • Living “out of means”, debt piled
- 10. 10 Money needs to be nurtured… • Phenomenal player in the late 80s & Early 90s • Won 49 titles in total • 6 Grand Slams • An Olympic Gold • $25mn in just prize money • Still got “historic” debt • Auctioned trophies to pay off debt
- 11. 11 Amit Kumar Gupta 10-Oct-2020 Investing biases
- 12. BEHAVE CORRECTLY The investor’s chief problem and even his worst enemy is likely to be himself ~ Benjamin Graham Reference : Joker (Amazon Prime) • Lack of advisor or guidance • Lack of time • Lack of knowledge • Or Plain old bad luck! • Develop strong Anti- investor bias •Contempt or cynicism for investing
- 13. OVERCONFIDENCE BIAS • It is a tendency to hold a false and misleading assessment of our skills, intellect, time or talent. • Over Ranking • Illusion of control • Timing Optimism • Desirability impact
- 14. CONFIRMATION BIAS • To favor information that confirms their preexisting beliefs or hypothesis. • People display this bias when they gather or remember information selectively, or when they interpret it in a biased way. • Example : Yes bank crisis, ITC dichotomy • Carl Jacobi - Invert, always invert!
- 15. AVAILABILITY BIAS • Tendency to let an example that comes to mind easily affect decision-making or reasoning. • The availability heuristic operates on the notion that if something can be recalled, it must be important. • Knowledge overflow! • Laziness is part of availability bias. • Heard and Read enough!
- 16. ANCHORING BIAS • We tend to rely too heavily on one piece of information, usually the first one, when making a decision or estimating the value of uncertain objects. • This initial “anchor” value is used as a mental reference point, which might influence the choice peoples will make. For Ex: Experiments show that average wine sales increase substantially by having the $150 bottle listed right next to the $95 bottle. The role of the $150 bottle is to act as a decoy to make the $95 bottle appear more desirable.
- 18. AVOIDING- RULEBOOK Minimal exposure to the media should be a guiding principle for someone involved in decision making under uncertainty — including all participants in financial markets. ~ Nassim Taleb Media Analyst Reports
- 19. Leveraging "IT'S NOT HOW MUCH MONEY YOU MAKE, BUT HOW MUCH MONEY YOU KEEP, HOW HARD IT WORKS FOR YOU, AND HOW MANY GENERATIONS YOU KEEP IT FOR." - ROBERT KIYOSAKI Avoid F&O till… • F&O consider weapons of mass destruction! • With higher margins, lower value accounts will wipe out in a short time frame • Trade with discipline and only selectively, if at all • Start F&O with paper trading!
- 20. Timing the Market “FAR MORE MONEY HAS BEEN LOST BY INVESTORS TRYING TO ANTICIPATE CORRECTIONS, THAN LOST IN THE CORRECTIONS THEMSELVES.” PETER LYNCH Timing matter less in CORE stocks for example : FMCG, IT Timing matter more in cyclical stocks for example : Cement, Metals, Commodity stocks Timing matter the MOST in special situation stocks – case specific
- 21. Borrowed conviction “WHEN IT COMES TO INVESTING, THERE IS NO BENEFIT OF THE DOUBT. EITHER YOU'RE RIGHT OR YOU'RE WRONG. YOU'RE GOING TO BE WRONG A LOT” – JIM CRAMER Borrowed conviction is much more dangerous than borrowed money. How will you decide position size? How will you decide exit? Buying low P/E stocks Buying 52w low Buying turn around stories Selling too early! Getting perturbed by analyst research reports
- 23. 23 Focus on Asset Allocation • Not a single asset class is consistently performing in the markets • Diversification across asset classes - Equities, Gold, RE • Debt adds stability to the overall portfolio • Invest more when valuations are low, Invest less when valuations are high • Time to invest in RE is coming soon!
- 24. 24 Overweight & Underweight sectors – How to derive position size? • Most useful in cyclical stocks • Entry and exits need to be timed • Play the cycle & Get out • Temporary concerns – go UW • Temporary upsides – go OW • Higher valuation – go OW, go EW • Fraud – Run! • ALWAYS GET FEEL ON THE GROUND!
- 25. 25 Read, Read & Read
- 26. 26 Read, Read & Read
- 27. 27 Perform at critical times Take calculated risks Perform under pressure What if decisions don’t go as per planned? Calmness and preparedness! Reference : Sully (Amazon Prime)
- 28. 28 Find your own path… अलग-अलग पथ बतलाते सब पर मैं यह बतलाता हूँ 'राह पकड़ तू एक चला चल, पा जाएगा मधुशाला।