Why EXPERTS are GIVING 100% opposite ADVISE of WARREN BUFFETT?
February 2, 17
Why EXPERTS are GIVING 100% opposite ADVISE of WARREN
BUFFETT?
Greetings from Hitesh! There was a
huge TRAFFIC on my 16th Dec.,2016 post after our last post on
BUDGET. This is most painful moment for the personal growth – as more and more
people are either living in PAST or thinking about FUTURE. They are not able to
focus on PRESENT OPPORTUNITIES. Had they read our post on 16th
Dec.,2016 itself, they would have made tons of money by now. But they missed.
They keep on missing. Why?
I see ROLE of EXPERTS for the same. What EXPERTS Are
PREACHING since AGES?
Do STAGGERED INVESTMENTS.
The basic logic of STAGGERED
Investment is, say you have Rs.10 lakhs, to invest over a period of time say in
6-12 months.
This is based on the LOGIC that
you can not time the market and it make sense to take advantage of ups and down
in the market so that your average remains around your original price.
Why NORMAL MINDS ACCEPT this advice?
People always listen to what they
want to and not what they are being told. NORMAL guys know that they don’t know
investing. They have not learned it, the way they have taken education for
their profession or jobs. They have no experience of it. They are not sure
about their success.
Rather than accepting their own
SHORT COMINGS, they do 100% opposite. If they accept that they don’t know –
they will have to learn it. They will have to CHANGE themselves, which they are
not ready. So, they use the EXPERT’s LOGIC to defend their own wrong behaviour.
Let us see the GAME from BIG GUYS PERSPECTIVE:-
He is investing MILLIONS or BILLIONS
in a single company. He might be taking a STAKE also. If he goes wrong – he
can’t sell his stake so quickly. If he wants to sell immediately – he would
have to book a heavy loss. So, they advise to find out the VALUE in the
business. They wait patiently till the price becomes attractive to the value.
When they see that there is a bargain in PRICE compared to the VALUE they are
getting - they simply invest all their
funds in one go. No staggering!!
They keep their funds in LIQUID
assets till they get such opportunities. Just because they have tons of money
to invest – they don’t invest like a FOOL. Just see BUFFETT is sitting on huge
cash pile as of now. He has always waited for the RIGHT PRICE and RIGHT
OPPORTUNITIES before investing.
Go through all his annual letters
and you will never find he is supporting of RUPEE COST AVERAGING while
investing. That’s why he is a BILLIONAIR.
WHO IS GIVING STAGGERED INVESTMENT ADVICE?
Look at all the guys who are
giving above advise to you. They will be either of the following - FINANCIAL
CONSULTANT / MUTUAL FUND MANAGER / MEDIA EXPERT or your FRIENDLY BROKER.
They all have their own VESTED
interest in giving you above advise. When they are saying do staggering – they
are not sure about the VALUE of the company they are suggesting or buying. They
are playing their total game on the PRICE, which is a derivative of the VALUE.
They follow the old ENGLISH THEORY
of DIVIDE AND RULE. This is the most dangerous suggestion for your personal
wealth formation. If you want to follow, you can still follow that.
What is the PROPER WAY based on the experiences of the
people who have made BILLIONS?
I have observed some common traits
of the people who have actually made billions.
1.
They buy only
and only when they feel they are paying the right price compared to the value
they are getting. The best deal for them would be when they get more value
compared to the price they pay.
2.
They can wait
for years till they get above opportunities. They are not fainthearted to be
taken for a ride by market rise or fall.
3.
They focus on
the company they are investing in rather than the overall market scenario.
Because they know – if market is PESSIMISTIC – then and then only they will get
the BEST COMPANY at there own price. So, they are least bothered by market
fall. In fact, they like it or they wait for it.
4.
Once they buy
they do not bother about the price movement in short term. They have their goal
of EXIT at pre-determined price and they wait for that.
5.
Peter Lynch
had bought one stock at USD 20 and it went down to USD 2 in just a year. He was
not perturbed at all. He waited for one more year and sold his stock around USD
40. The point is – they worry about the
fundamentals and their exit price. If the fundamentals are steady – they do not
worry at all for the price movement.
6.
Big money can
only and only be made when you invest with 100% conviction. In staggering – you
are doubtful from within from the day one. That is the reason – you will never
find BILLIONAIR amongst people who have done STAGGERED INVESTMENTS.
What NEXT?
Right Investor Education is the
MISSION on which I am working relentlessly for over 27 years. If my sharing can
make you think about your own wrong investment patterns and if you can muster
the courage to change – I will feel – I am successful at least in your case.
Have a GREAT FEBRUARY.
Live With
Passion…Invest With Passion.
Hitesh Parikh.
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