ValuePickr Forum

VP CHINTAN BAITHAK GOA 2015: Dnyanesh: ART OF INVESTING

Finally some wisdom, direct from Mr D :smile:

Dnyanesh was the catalyst around whom the VP Chintan Baithak coalesced. Though he always preferred to remain in the shadows, surprisingly this time he was the one who goaded us into meeting together for 3 days - bonding/sharing & learning. He said we must meet, celebrate, and rejuvenate!

Most at VP had only heard of Dnyanesh and his life-changing (for VP) ART of Investing precepts, courtesy yours truly. Most had naturally assumed him as the Grand Old Wise Man. Hitesh (and most others) were pleasantly surprised to find our young, handsome & humble Mr D - and couldn’t help shaking their head, and muttering …thought he would be much older :wink:

Without much ado, let’s get into the core of VP ART of Investing wisdom - straight from the horse’s mouth.
Art of investing @ ValuePickr June '15.pdf (878.9 KB)

It will always be an understatement to say, VP Community couldn’t have reached where it has without the sagacity of Dnyanesh - his involvement and constant challenges for us to move up the learning curve - guided by the timeless investment tenets he lives by.

Let’s all use the opportunity to extract more from my Guru!
Though he is unusually reticent to post/reply at public forums, I am sure we can find a way to get back with his responses, may be in a digest form - or may be the way all of you respond might coax him to relax his conservative standards - and start replying direct !!

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To me each line in the presentation feel’s like the teaser of an untold story :frowning:
Guys, some of the participants have to stand up to reveal more of this presentation to us.

Regards
RajPanda

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I agree with Raj.
Seems like there is lot more which was shared & elaborated but wasn’t written in the ppt/ only one bullet point is written.

Need more details of the talk to help us understand more.

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Thanks Donald and Dnyanesh!
I would like some elaboration on the “State of mind” and if possible to share some examples of signals based on “thinking like owner”.

Nice. Lots of mull about. Will take a while for everything to register !

Dnyanesh’s presentation was a highlight for me at VP. And I was always eager to meet someone who was Donald’s guru. And as pointed out by Donald, was pleasantly surprised to see someone so grounded who was so full of wisdom.

Amazing insights and great humility. :ok_hand:

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The images in the presentation are so spot on! Bull vs. Bear, Boat Vs. Land :thumbsup:
Also the quote “Selling is more art, error prone” - superb.

@Donald, @hitesh2710, @ayushmit , if you can somehow provide us with details for the slides (or shall I say gold mine), it will be wonderful. A video recording would be even better :smile:. Please consider.

Thanks,
Rupesh

There is indeed a Gold Mine in Dnyanesh’s presentation :smile:
The high-impact things that really matter - he has brought them into FOCUS in his inimitable style, beautifully.

Unfortunately there is no video recording - as this was the first time, most guys were apprehensive that free-flowing presentation/discussion will be hampered with a camera on - especially for those of us not used to public speaking !

Thanks for the suggestions coming in from Akbar, Raj Panda on how to take this forward. Essentially there are 2 ways, and I feel both should be employed

  1. We could request Dnyanesh - to expound on a specific thought/teaser - with an additional slide or two at most. We might also get the young turks who participated to expound on what they absorbed from Dnyanesh’s talk on say on a central idea of “Thinking like an Owner of the business”. That will make for a richer discussion

So here we need you to identify 4-5 key teasers/takeaways from the presentation. What do you most want to FOCUS on :smile:

2.Act like Prof Bakshi. Use that central idea/teaser/hypothesis and try to learn what all the Gurus have said on that topic. I heard him saying he added “Niche Business” to his repertoire recently - and the first thing he did was to use his Kindle to locate what every guru/book in his investment collection had to say about it - collate them and print that out - and dive deep into it!

I have been thinking since hearing him a couple of weeks back at FLAME, that this is a brilliant approach which all of us MUST adopt - when we are “teased” mighty by a concept (thanks @rupeshtatiya) - if we want to dive deeper and understand what great minds have already said/done about it. The best part of the ART of Investing is that there is no need of re-inventing the wheel …whatever brilliant idea/tactic or strategy anyone might come up with is already there in public domain …probably all dressed/laid-out for s to partake :slight_smile:

Simultaneously attempting this second tactic/strategy to learn will be equally beneficial for us - for a much richer conversation on this extremely important thread.

Cheers

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Even I would like a bit more elaboration on the points under “State of Mind”. What does he infer by Iterations ? Some of the points are very similar(to me) -Maybe, Likely/probably, uncertain, ambiguous. I would appreciate if anyone can give some examples.

Hello Dnyanesh,

First off, huge respect and the way i see it you are the “Charlie Munger” to Donald(Buffett).
That is probably the highest compliment i can pay to either of you!

Coming to the presentation, which i think is very profound and provides the motivation to introspect and dig deeper on each of the points highlighted in every slide.

I would like to convey my understandings of some of the points which i felt from my perspective are pretty important.

State of mind

  1. It is about knowing one’s strengths and weaknesses
  2. Being aware of the mental models in the toolkit, and the gap to be filled
  3. What are the biases to which one has succumbed to in the past?
  4. Stronger the mental model latticework, better is the ability to perceive the pattern of past winners.
  5. Vicarious knowledge - learning from other’s mistakes.

Rational anticipation

Rational Micro (mostly) vs Irrational Macro Events enable
investors to SPOT & VALUE pricing anamolies

I cannot speak for others, but for me this is something which i realize in hindsight was the market phases where i unknowingly picked up mispriced winners.
Some of the examples which come to mind are Fluidomat, Finolex Cables, Acrysil and more recently Selan.
It also implies a strong contrarian/independent mindset is required to cash in on the anomalies.

Luck Vs Skill
This cannot be underestimated enough.
I am not ashamed to say that i was and am still lucky to have a profitable pf.
I was LUCKY to -

  1. Find a forum like ValuePickr in the first place
  2. Being there in the right place at the right time. Had 6-9 months accumulation phase pre-Modi in 2013 and the obvious rally from Jan 2014.
  3. Be working onsite, and therefore able to allocate meaningful capital to high conviction picks such as Avanti, Shilpa and Ajanta.
    There was a little bit of SKILL as well though :smile:
  4. Building the conviction
  5. More importantly, having the patience to hold and sit tight

But the real SKILL comes when the tide goes out and we are in the full throes of a bear market, which is inevitable.

Valuation
It is relative and never absolute.
Relative to the industry, its peers and the economic cycle.

Selling is more art, error prone
I had tweeted one of Tom Gayner of Markel, famous quotes which i would never tire to quote -

All investors typically start off diversified and start to concentrate as they mature. Above quote typifies that to a tee!

To conclude, from what i understand Capital Allocation is the single most important factor which we need to consider when we put on the “Owner’s Cap”.

I hope senior members can validate or correct my understandings appropriately based on Dnyanesh’s session.

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Donald

When is the next VP Chintan baithak? I will be quite keen to join.

Rajeev

I always used to wonder who is Mr D. Thanks to this thread which I came across as a result of search for VP Chintan Baithak threads, I now know atleast that Mr D is not any fictional character :blush:

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:slight_smile: not only is he not a fictional character, but he is a super refined thinker of investing and wonderful person.

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No doubt. One can easily guess from the discussions.