For Whom Wealth Matters
March 23, 2011 1 Comment
I found these words of Warren Buffett in today’s newspaper.I guess it’s time for us Indians to celeberate a bit.
” I don’t consider India as emerging market , I consider it as a very big market . But if you look at what many classify as emerging market , the business tends to be much smaller . We need to invest billions of dollars and that is very tough in emerging markets . ”
—— Warren Buffett
March 12, 2011 7 Comments
I graduated in 2000.In the same year I made my first purchase of gold.Since then I’ve been watching the price of gold.The first thing to attract my attention was the relentless upward movement in the price show in the graph below: 
Logic suggested that what goes up in price must come down.So I tried looking for the historic prices of gold to try to see if there was a cycle . Read more of this post
March 7, 2011 6 Comments
Here are 9 ways listed by Whitney Tilson to pick diamonds in the stock market:
1. Out-of-favour blue chips. Even the world’s greatest companies encounter problems or otherwise fall out of favor. Correctly differentiating between those suffering temporary rather than permanent issues is the key to success here. As long as the positive fundamentals of the company’s business remain intact, and new management is willing and capable of bringing the company on track buying out of favour blue chips can be very profitable.
2. Distressed industries. Buying a good company in a distressed industry is often a great way to make money.
3. Turnarounds. Turning around a broken business is difficult and often takes much longer than expected — but when it occurs, a stock can rise many-fold.
4. Overlooked small caps. Among the thousands of publicly traded stocks that analysts don’t cover are fine businesses that are cheap because either no one is paying attention to them or their stocks are thinly traded. Read more of this post
March 7, 2011 Leave a comment
Here are 5 situations that Whitney Tilson lists where investors can lose money:
1. The game has changed.Bargain Hunters and Bottom Fishers Beware!There’s a fine line between opportunity and trouble when a once-strong business goes into decline.
2. High and rising debt. Value investors are naturally drawn to companies in trouble — that’s what makes stocks cheap if the difficulties prove to be temporary. But too much debt can ruin even the best-planned turnaround.
3. Consumer fads. When investors extrapolate far into the future what are highly likely to be impossible-to-maintain growth levels, trouble follows.
4. Serial acquirers or mega-acquisitions. Given the research showing that a significant majority of acquisitions are value destroyers for the buyers, it’s remarkable how frequently investors get excited about roll-up stories or big acquisitions.
5. Aggressive accounting. The gray areas in accounting leave managements considerable leeway in how aggressively or conservatively to represent company operations. When a company’s accounting treatment creates more questions than answers, something is usually wrong.
March 6, 2011 Leave a comment
The following is a repetition of material found here https://wealthymatters.com/2011/03/06/the-dhandho-investor/ . But I think the material is significant enough to bear repetition.This is a list of reasons why a Dhandho Investor who wants High Returns but Low Risk should prefer to buy stocks rather than businesses.
I am rather indiscriminate when it comes to businesses.I would rather make money from a whole bunch of businesses rather than content myself with one source.And as the Indian economy explodes and money is made in so many different ways it’s so hard to pick just a few businesses to focus on or to put money in.The list below is my way of consoling myself for all the businesses I will never own.
wealthymatters 