naveegator.in

Author: Naveen

  • Four years as shareholder of VIP Industries

    Four years ago after my thorough research I decided to invest in VIP Industries (and I can’t remember what that research was). I invested twice in 2017 when the share price was just below ₹ 200. After that the share price climbed sharply resulting in more than 200% return in next one year. I patted myself on the back for my (non-existant) stock picking skills. Then came COVID. The COVID pandemic crash wiped off everything in one month. One month! I invested twice during the crash to accumulate more shares at lower prices. The returns have since recovered but it is nowhere near the 200% mark that I once saw.

    Return

    Profit

    The COVID pandemic crash was probably the most severe for VIP Industries in my portfolio. From 170% profit to 20% loss in one month. And it made sense considering the travel ban imposed because of COVID. It has recovered but I am yet to see the astronomical heights that I saw in Sep 2018.

    XIRR

    NOTE: XIRR for initial months varies wildly and is not useful for any analysis. But once the investments complete minimum of 1 year, XIRR gives me a much better picture. So I calculate ‘XIRR (>1 year)’ which calculates XIRR only for the investments which have completed minimum of one year while ‘XIRR’ continues to calculate for all the investments irrespective of how much time has been completed. There are some periods where ‘XIRR’ and ‘XIRR (>1 year)’ calculate to the same amount as for that time all my investments had completed minimum of 1 year.

  • Four years as shareholder of Pidilite Industries

    Four years ago after my thorough research I decided to invest in Pidilite Industries (the company made Fevicol and that was the only research I did).

    Return

    Pidilite Industries has been probably one of my most consistent performers. Even during the COVID pandemic crash, the worth of my investment never went below my amount invested.

    Profit

    Except during the early months of my investment I am yet to see a loss with my investment in Pidilite Industries.

    XIRR

    My ‘XIRR (>1 year)’ has been so good with Pidilite Industries, that even at the worst point it was giving better returns than fixed deposits.

    NOTE: XIRR for initial months varies wildly and is not useful for any analysis. But once the investments complete minimum of 1 year, XIRR gives me a much better picture. So I calculate ‘XIRR (>1 year)’ which calculates XIRR only for the investments which have completed minimum of one year while ‘XIRR’ continues to calculate for all the investments irrespective of how much time has been completed. There are some periods where ‘XIRR’ and ‘XIRR (>1 year)’ calculate to the same amount as for that time all my investments had completed minimum of 1 year.

  • Six years as shareholder of HDFC Bank

    Six years ago after my thorough research I decided to invest in HDFC Bank (my ICICI Bank relationship manager advised me to invest in HDFC Bank and not in ICICI Bank, and I am glad he did).

    Incidentally, HDFC Bank was the start of my investing journey. It was the first share that I bought. Being a rookie back then, at one point I bought just one share to round off the number of shares with me. After the contract statement came I realised that I had paid a hefty brokerage charge on that.

    Return

    Between Feb 2018 and Feb 2020 I did not invest in HDFC Bank. Why? Because I was busy investing (ahem, diversifying) in Greenply, IDFC First Bank and Supreme Industries. That was a lost opportunity in hindsight.

    Profit/Loss

    XIRR

    HDFC Bank is one of the stars of my portfolio, consistently maintaining XIRR of more than 20% except during the COVID pandemic crash where my five years worth of gain were wiped off in matter of weeks. It has since recovered though.

    I invested steadily in HDFC Bank during the COVID pandemic market crash as I wasn’t sure if other companies will survive the post COVID pandemic era. And I am hoping HDFC Bank will.

    NOTE: XIRR for initial months varies wildly and is not useful for any analysis. But once the investments complete minimum of 1 year, XIRR gives me a much better picture. So I calculate ‘XIRR (>1 year)’ which calculates XIRR only for the investments which have completed minimum of one year while ‘XIRR’ continues to calculate for all the investments irrespective of how much time has been completed. There are some periods where ‘XIRR’ and ‘XIRR (>1 year)’ calculate to the same amount as for that time all my investments had completed minimum of 1 year.

  • Four years as shareholder of Marico

    Four years ago after my thorough research I decided to invest in Marico (I realised embarrassingly late that Marico manufactures Parachute which I have been using for decades). This is how it has performed for me.

    Return

    The first year of my investment’s worth was flat with no gains; the second time I bought Marico after one year, it was at the same levels as the first time. But the next three years the share price has been steadily improving (except the COVID pandemic crash).

    Profit

    XIRR

    Post COVID pandemic crash, the share price has recovered and is at 15% XIRR. I am hoping it continues with that rate for coming years and provide me with inflation beating returns.

    NOTE: XIRR for initial months varies wildly and is not useful for any analysis. But once the investments complete minimum of 1 year, XIRR gives me a much better picture. So I calculate ‘XIRR (>1 year)’ which calculates XIRR only for the investments which have completed minimum of one year while ‘XIRR’ continues to calculate for all the investments irrespective of how much time has been completed. There are some periods where ‘XIRR’ and ‘XIRR (>1 year)’ calculate to the same amount as for that time all my investments had completed minimum of 1 year.

  • You need to cut yourself some slack

    A wonderful article by Shane Parrish on why slack is so important. It’s so important there is a book about it–Slack: Getting Past Burnout, Busywork, and the Myth of Total Efficiency.

    …imagine one of those puzzle games consisting of eight numbered tiles in a box, with one empty space so you can slide them around one at a time. The objective is to shuffle the tiles into numerical order. That empty space is the equivalent of slack. If you remove it, the game is technically more efficient, but “something else is lost. Without the open space, there is no further possibility of moving tiles at all. The layout is optimal as it is, but if time proves otherwise, there is no way to change it.”

    Having a little bit of wiggle room allows us to respond to changing circumstances, to experiment, and to do things that might not work.

    Slack consists of excess resources. It might be time, money, people on a job, or even expectations. Slack is vital because it prevents us from getting locked into our current state, unable to respond or adapt because we just don’t have the capacity.

    Efficiency is the Enemy

    And at the end.

    Amos Tversky said the secret to doing good research is to always be a little underemployed; you waste years by not being able to waste hours. Those wasted hours are necessary to figure out if you’re headed in the right direction.

    Efficiency is the Enemy

    Wow!

  • Three years as shareholder of Nerolac

    Three years ago after my thorough research I decided to invest in Nerolac. My research was so thorough that it was only on trying to buy the share I realised it is not Nerolac, its Kansai Nerolac. I have invested only thrice over these three years. Below is how the returns have been for me.

    Return

    Profit

    XIRR

    NOTE: XIRR for initial months varies wildly and is not useful for any analysis. But once the investments complete minimum of 1 year, XIRR gives me a much better picture. So I calculate ‘XIRR (>1 year)’ which calculates XIRR only for the investments which have completed minimum of one year while ‘XIRR’ continues to calculate for all the investments irrespective of how much time has been completed. There are some periods where ‘XIRR’ and ‘XIRR (>1 year)’ calculate to the same amount as for that time all my investments had completed minimum of 1 year.

  • When to sell stocks?

    Probably the most practical set of examples on when to sell stocks from your portfolio by R Venkataraman writing for Economic Times.

    I have many stocks, which I am holding for years. I don’t look to optimise every stock, and I don’t think it is worth the time and effort. I am not a professional fund manager, and retail investors should ideally not waste time trying to optimise a portfolio. There will be duds and some stars and vice versa. The key is to emerge fine on an overall portfolio basis.

    I have sold shares when I need money to do something in the real world, which in my case, was real estate. If you don’t need to break the portfolio, please don’t.

    I have sold shares when I needed to sell X to buy Y. At that time, I evaluated all stocks, and picked the ones to sell, which in my opinion, would not do as well as the new entrant. I am not an active churner; this exercise happens rarely.

    I have sold shares when stocks were giving returns beyond my imagination, which happened this year. This is a new feeling for me because most stocks in my portfolio usually move slowly. This year, some of my stocks have risen vertically. So I have booked profits. I use a mental model, which is not very scientific. So don’t waste time trying to poke holes in it.

    Develop your own rule of thumb that makes you happy. I tell myself, sell 50% of the stocks, so that remaining stocks are free. This I learnt from my friend HM, who used an acronym SHAD – sell half at double – and let the rest run.

    Selling stocks? To do it or not to do is indeed a big question

  • What’s in a name?

    It’s often said that the stock market’s main oxygen comes from sentiments and the share price has hit the roof for a company that has the word ‘Oxygen’ in its name despite its business having nothing to do with the life-saving gas — something in high demand due to the Covid-19 pandemic.

    The share price of Bombay Oxygen Investments Ltd hit its upper circuit limit ₹ 24,574.85 apiece at the BSE on Monday, with the maximum permissible gain of 5 per cent due to the stock being under surveillance. The same is the case with some other little-known stocks with ‘gas’ or ‘oxygen’ in their new or old names and all of them are being probed for any possible foul play.

    What’s in a name? A lot for stock market, if it’s ‘Oxygen’ in Covid-era!

    I mean… I can’t even… Kaun hain ye log? Kahan se aate gain ye log?

  • Four years as shareholder of Motherson Sumi System Limited

    Four years ago I didn’t know what Motherson Sumi System Limited was and what it did. The only reason I invested in it was that 100+ other mutual funds had invested in it. If so many mutual funds have invested in it, then the company must be good. That was the only research I did. 

    After learning about some thing called as “dollar cost averaging”, I invested more amount when the price fell. After the price fell even more I stopped investing as I learned something called as “don’t try to catch a falling knife”. 

    It has been a roller coaster ride on this one. In the crash of Mar-Jun 2020 the worth of my investment was just 30%. And in the subsequent months it recovered and returned to positive value after almost 3 years. 

    Return

    Profit

    XIRR

    NOTE: XIRR for initial months varies wildly and is not useful for any analysis. But once the investments complete minimum of 1 year, XIRR gives me a much better picture. So I calculate ‘XIRR (>1 year)’ which calculates XIRR only for the investments which have completed minimum of one year while ‘XIRR’ continues to calculate for all the investments irrespective of how much time has been completed. There are some periods where ‘XIRR’ and ‘XIRR (>1 year)’ calculate to the same amount as for that time all my investments had completed more minimum of 1 year.

  • Embrace the Grind

    An article worthy of putting on a refrigerator magnet so that I can read it every day.

    I often have people newer to the tech industry ask me for secrets to success. There aren’t many, really, but this secret — being willing to do something so terrifically tedious that it appears to be magic — works in tech too.

    We’re an industry obsessed with automation, with streamlining, with efficiency. One of the foundational texts of our engineering culture, Larry Wall’s virtues of the programmer, includes laziness:

    Laziness: The quality that makes you go to great effort to reduce overall energy expenditure. It makes you write labor-saving programs that other people will find useful and document what you wrote so you don’t have to answer so many questions about it.

    I don’t disagree: being able to offload repetitive tasks to a program is one of the best things about knowing how to code. However, sometimes problems can’t be solved by automation. If you’re willing to embrace the grind you’ll look like a magician.

    Embrace the Grind

    Read on for some amazing examples.