2 years ago, I wanted to use the Aadhar based OTP method of e-verification. But it wouldn’t work. The system failed to match the records.
The reason is my PAN. My PAN was created in 2002 or 03. At that time, I had a middle name – “KUMAR”.
You see, my father is a old Bollywood movies fan.
Systems are programmed to behave like systems. For my PAN and my Aadhar, I was two different people, courtesy my middle name.
So, they didn’t link and did not allow me to e-verify.
What do I do?
This is Part 2 of the note by Balaji Sridharan, an equity investor, who shares his approach and thought process on investing.
In Part 1 he suggests that every equity investor asks two questions:
He then goes to explain how possibly can an individual investor seek those answers.
Subsequently, he questions whether one is ready to be an equity investor by taking up three 3 hurdles that one has to face.
You can read the Part 1 here.
Part 2 continues.
Once you are past all these hurdles, the question “how does one think about companies” arises?
There is enough literature out there from Ben Graham, Seth Klarman to Phil Fisher taking from deep value to high quality, growth companies. We will not rehash about any of these. Instead we will talk about a few of the filters that I use to pick stocks.
What this essentially means is that can you envision what the company will look like five years from now?
Before you make an investment decision, you would knowingly or unknowingly run the following questions in your mind:
These questions are about the 3 essential elements of investments – Safety, Liquidity and Returns.
Let’s see what are you most likely to do if you were to focus on just one of the elements.
What is the safest investment? You would typically invest in a PPF, NSC, Government Securities/Bonds, Bank Fixed Deposits, etc.
What is the most liquid? Well, cash in the locker, money under the mattress or your savings/ current account are the likely places.
What will give the highest or best return? Now, that’s where the conflict begins. Will this be the one with highest safety and liquidity?
My client sent me an email a couple of days ago. He replied to my suggestion to get his financial planning done. What he was trying to say in his reply is why he shouldn’t be doing financial planning. You can read the email here. I have now written my response to his email. Here it is. Read … Read more