Wednesday, September 9, 2020

FOMO and Punishment by Sehwag !!


One of my oldest friend in this field HARISH KUMAR is a huge fan of Sports and passionate about Investments. 

He is very grounded and gets rarely excited or depressed. 
He almost always gives excellent analogies relating to Sports and here is one of his sharing. 








THE BACKGROUND BEHIND THE RAPID RISE SINCE MARCH LOWS : 

Financial Economy(Markets) will always recover first..much before the Real Economy does..

The theory of watching the Inflation, GDP Numbers,Earnings of the companies for each & every quarter happens in the ideal scenario(I.e..When the Interest rates are above the acceptable levels).

Markets are in the Power Play Mode..

During the Lower interest rates phase in the economy, the markets will discount 4-5 years earnings in just 1-2 years..



JUST A TRAILER ! 

What we have seen so far(I.e..in the last 5-months) is just a trailer..

I m not saying that Sensex will go to 45-50K in a straight line..It will take its own path.

I strongly feel that we should be at those levels in the next 3-5 Quarters.

I will give an example..
If a Company has got Rs,10000 Crs Debt on the Balance Sheet..
@10% interest rate, they were shelling out 1000 Crs as interest to the financial institution they had borrowed from..

After Covid, @ 8%, they will be paying them 800 Crs.
200 Crs will be the savings for the company without even breaking the sweat.
If the Company was declaring 1000 Crs profit earlier will show 1200 Crs profit in the future.

If you consider 20% increase in the profits for the next 4 years..
20*4 = 80%

Consider there is decline of 20% earnings for this Financial year..


80-20 = 60%.

I have not accounted for any growth in the profits of the company due to increase in the future sales, expansion capabilities bcoz of lower interest rate regime..etc.

1 + 1 will not become 2 in Equity Markets always..it can become 3,4,5 sometimes..๐Ÿ˜ƒ๐Ÿ˜ƒ

3 things could happen in the next 2-3 Quarters.

1) Most of the investors, who have not seen any returns in the last 2-3 years & having the tendency to compare their Equity investments to FDs, Gold...etc will exit at current levels +/- 5% .

2) All those investors who have not invested in the last 4-5 months & expecting the Markets to test March lows would lose patience & start entering slowly & finally invest big at 45K + levels when the economy would be functioning normally next year.

3)The Fixed Income Investors who wouldn't be happy with 5% returns will be entering the markets through MFs after April..Bcoz of the low base effect..
Most of the funds after April 2021 will be showing 30,40,50%.. One year returns..

๐Ÿ‘†The Quantum of Money flow will be driving the markets in the short to medium term & not the earnings & GDP..

& I haven't accounted for the Corporate tax cuts which was announced last September..
That's not yet played out fully..

Above are the reasons, Why I was bullish on equities from April onwards..

THE CRICKET CONNECTION : 

The Behaviour of many  investors in the last 4 months reminds me of the situation  Mohammad Sami and Mohammad Yousuf, The Pakistan fielders were in  the India Vs Pakistan Test match at Multan in 2004...when they dropped Sehwag on 68 & 77 respectively...The rest was history,
He went on to score the First Triple Century for India in Test Cricket..
[The Virus had given a fantastic opportunity for the Investors to invest at lower levels during March-May,But most of them missed the opportunities like Sami & Yousuf on a good batting track in the first innings,(Huge global liquidity),Sehwag took the control later].

As & when the boundaries & Sixes were scored by Sehwag after the dropped catches, The  cameras were focusing on Sami & Yousuf..

(As & when the Markets started scaling higher & higher..There was disbelief..They started Cursing the markets for scoring too quickly).

Sami took Sehwag's Wicket eventually,but it was too late..History was created..Sehwag had scored the First Triple Century for India & the 2nd Fastest Triple Hundred then.309(375), which was bettered by him 4 years later against SA in 278 balls at Chepauk in 2008..(New/Fresh Market highs will be created before most of the investors realise it).

The Master Blaster also added to their woes by scoring 194*.
(The Big Bulls like RJ & Porinju have joined the party from the last month or so)..

Yousuf was going to his bowlers Sami,Shoaib Akhtar & Saqlain frequently to give them some tips to get Viru's wkt. But, Viru batted them out of the game 
(The Market experts tried their best to get the Markets down quickly..
Posted stories of Robinhood & Abhimanyu stories because of jealousy,But in Vain.)

India declared the innings for a mammoth 675/5.[Not everything is lost now..We are in a situation currently  in the markets looking from a 3 years perspective)where we were 173/2 after losing Akash Chopra (42) & Dravid (6)..(short term corrections).
The Little Master has joined Sehwag at the Crease..]

Pak lost by an innings & 50+ runs..
(We can beat inflation by a bigger margin & create huge wealth in the medium to long term)...

๐Ÿ‘†Howzzaaaatt Guys ??๐Ÿ˜ƒ






SIMILAR STORY : 
Rohit was dropped on 4 by Thisara Perera during his record-breaking ODI knock of 264 from 173 deliveries against SL in November 2014 at Eden Gardens..

The Costliest/Expensive drop in ODI Cricket History..๐Ÿ˜ƒ
(The Expensive drop/missed opportunity/rally ever for the Investors in the Global markets of around 50%in less than 6 months).

When markets correct running for cover or trying to salvage what is left is never a good option . If our country has to prevail markets has to do  well.
Ultimately markets are nothing but the reflection of our economic well being. The current interest rate scenario makes us less competitive.

You need an an approch like V-I-R-U to defeat the V-I-R-U-S.

Regards,
Harish Kumar
















SRIKANTH MATRUBAI's take : 
Cricket and Investing has so many common similarities.
In Cricket....you aim to win the match.
In Investing, you aim to WIN the goals of Life.

In game, you can afford to LOSE but in Investing, you cannot afford to LOSE....definitely not in the LONG TERM.

Like a FREE HIT in Cricket, there are some rare times in Investment, when you get REAL GOOD OPPORTUNITY to make money and this March downturn was one such lifetime opportunity.
But, you should be GROUNDED in your thinking and thought process to identify the same and make use of it.
Here, in this blog, we have posted more than half a dozen articles during the March/April downturn extolling our readers to not only STOP getting worried about the Market falls but we also encouraged to consider looking at putting SOME LUMPSUM money.

Remember, for a bowling unit, a Batsman at the crease for a long time (even if he is not scoring) is more dangerous than a New Batsman.
Stick to looking at STAYING AT THE CREASE and make use of any BAD BALLS (market falls). 


Do get in touch with your Advisor and continue your journey towards Financial Independence.
All the best,
Srikanth Matrubai





You are strongly encouraged to consult your financial planner before taking any decision regarding this investment. The views expressed here is the authors personal views and should not be intrepresented as a recommendation to invest/avoid.
Srikanth Matrubai Author of the Amazon Best Seller DON'T RETIRE RICH
Do read the book and give your valuable feedback and request you to post positive comments on the Amazon. https://amzn.to/3cHUM6M/ You can purchase the book on amazon and flipkart Please subscribe to my TELEGRAM channel https://t.me/MutualFundWORLD/

Friday, August 21, 2020

GANESHA SHOWS THE WAY TO FINANCIAL FREEDOM




Lord Ganesha is worshipped before beginning anything auspicious, so, this is a great time to START your journey towards becoming FINANCIALLY FREE.

Lord Ganesh is revered as the Lord of Beginnings and Remover of Obstacles.
Lord Ganesha is one who is loved by young & old alike.




THE BIG HEAD 
Lord Ganesha's BIG Head indicates us to Aim BIG and achieve BIG.
Our Financial Plan should be such that we achieve something BIG in life.
Obviously this means that our focus should be on LONG TERM GOALS


SMALL EYES :
Our Financial Plan should take into all the small Nitty Gritty Minute Details which could create obstacles in achieving our Long Term Goals.  
The Small eyes shows that we need to CONCENTRATE on minute things which look small but not actually be so.
Remember : A Small Leak can sink a HUGE SHIP!


LARGE EARS :
A saying goes "A Good Listener is a Good Leader".
When you listen with open mind, you LEARN and when you learn, you implement, and when you implement, YOU WILL GROW.
Keep your Ears Wide open to absorb knowledge from all corners and listen to Experts whenever & wherever possible especially when it is from a person like SRIKANTH MATRUBAI!!!

SMALL MOUTH : 
The Small Mouth of Lord Ganesh is a indication to us to Talk Less, Talk Sense and Work More.  Also dont be loud mouthed with your Finances, discuss your investment plans only with trusted persons like SRIKANTH MATRUBAI!!


SHARP SINGLE TUSK : 
The Single Pointed Tusk of Lord Ganesh indicates us to discard Duality from our minds. Have a Clear Cut Definite Goal and Focus on 1 Goal at a time and then move on to another. Dont jump from one target to another in between without reason.




YOUTUBE VIDEO
Request you to also watch this cute video which explains about Financial Freedom.
Watch with your family
https://youtu.be/viTXJOh6jWw
Lets get to learn the lessons on Financial Freedom through this beautiful story. 
See this video with your family.


LARGE TRUNK : 
Your Financial Plan should have the flexilbility and adaptibility to recognise and weed out the Rotting Apples and retain performers. Very important in an ever changing circumstances. Remember a Trunk has the Capacity to uproot a Tree and at the same time, even pick a Needle!
Your Plan should be that Flexible!!

LARGE STOMACH : 
The Large Stomach shows us that our Plan should have the wherewithal to withstand and digest the Volatility. It should have an ideal mix of Debt, Balanced and Equity Funds.
Develop to Digest all the volatility. Have patience.  The BIG Stomach shows Acceptance.

While some funds/Stocks could look hugely attractive with all indications of being the next multibagger, stay calm,  let the news flow filter out and the dust settle and take required action once the Air is cleared.
Your Portfolio (like Lord Ganesh’s Stomach) should have the capacity to absorb everything and digest the same.
 

MOUSE : 
Lord Ganesha's vehicle is the small MOUSE.
Mouse cuts Ropes that Bind. Cut desires that make you spend more and prevent from Investing.
Keep Desire of Devil under Control.
Ride it rather than making it scare you.
Control the desires (mouse) or the Desires  will destroy your wealth
Even tough the Modak is next to it, the Mouse dare not eat the same without permission of Lord Ganesh.
Likewise, no profit booking without your Advisors' consent.

ANOTHER POINT REGARDING MOUSE : 

Mouse has the ability to see even in Dark.
Know how to see the light even in Dark times. Follow your the path shown by your Advisor and stick and you will reach the LIGHT.
Control the Mouse (Desires) and you will see LIGHT!!

MOUSE also indiciates that even the Mightest depend on the smallest.
So, a small SIP could easily make you the CROREPATI.

Yet another thing having the small Mouse as his vehicle shows that Lord Ganesha believes in humility and Simple Living. Learn to live within your means.
Don’t care, if your neighbours have a Mercedes or Rolls Royce, focus on YOUR capability and comforts (you never know how much EMI they are paying for that show off and how much stress they are going through to maintain that lifestyle !)



ONE FOOT ABOVE ANOTHER FOOT : 
Ganeshaji is usually seen sitting with 1 leg folded and other on the Ground.
Meaning aim for the Sky but be rooted to the Ground.
Aim for a  BILLION even a ZILLION but know your capacity and aim for achievable Goals!!
Having a Goal too high could lead to disappointment.
Accept your limitations and work towards realistically achievable goals.
 

ELEPHANT HEAD :
Many investors tend to start believing that having invested for so many years, I am the expert now….
NO….continue to take the guidance of your ADVISOR whose full time job is to monitor the markets and your portfolio. Better to use your head wisely by wearing the BRAIN of your Advisor and avoid needless pitfalls in the Wealth Creation Journey.

GANESHA TURNS UP ONCE A YEAR:
There is no need for you to keep looking at your portfolio valuation every day.
Lord Ganesha turns up once every year.
Have a Review of your Wealth Creation Journey once a year with your Advisor and that should be more than enough.
Remember, if there is something extraordinary events that can affect or affected your portfolio, your Advisor would definitely get in touch with you and do the necessary realignment.



FINALLY, THE MODAK : 
the Delicious Modak/Kadabu is awaiting for you at the end for your patientce, sharp focus as a Reward.
Modak is digestive aid and full of Proteins. And this Prasad is given at the End of the Pooja and you too will get your DESERVING REWARD when you stick to your Financial Plan and follow the advise of your FINANCIAL ADVISOR.





Post Script : 

Many images of Lord Ganesha has a Snake wrapped on HIS Stomach. 
This indicated PROTECTION OF CAPITAL (Profit).
It also indicates controlling of things which cause us unrest.
For a Successful Financial Plan, it is necessary to do constant review, monitoring and need to book profit/protect Capital in case of extraordinary events.


Best of luck,
May Lord Ganesha bless you with Health, Wealth and Happiness.
Srikanth Shankar Matrubai














YOUTUBE VIDEO
Request you to also watch this cute video which explains about Financial Freedom.
Watch with your family
https://youtu.be/viTXJOh6jWw
Lets get to learn the lessons on Financial Freedom through this beautiful story. 
See this video with your family.


You are strongly encouraged to consult your financial planner before taking any decision regarding this investment. The views expressed here is the authors personal views and should not be intrepresented as a recommendation to invest/avoid.
Srikanth Matrubai Author of the Amazon Best Seller DON'T RETIRE RICH
Do read the book and give your valuable feedback and request you to post positive comments on the Amazon. https://amzn.to/3cHUM6M/ You can purchase the book on amazon and flipkart Please subscribe to my TELEGRAM channel https://t.me/MutualFundWORLD/

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