21 Years of Investing – Key Lessons That Changed My Thinking

Investment Learning
83

Quick note on Promoter or Management buying the stocks -

Promoters sell for many reasons, but buy for one: conviction.

• Open-market buying with personal cash matters most.

• CEO/CFO purchases carry stronger signals.

• Cluster buying by multiple insiders is powerful.

• Not a standalone strategy, but a strong special-situation trigger.

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84

Sir pls margin of safety kaise calculate krte hai. Pls samjhiye.

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85

Margin of Safety is very important concept in Value investing.

Margin of safety is the gap between the value of the Business and the price quoted in the market.

Price everyone know.

But what separates a naive market participant to a Intelligent investor is understanding of Value.

The Value of the business derived from multiple ways. It depends on the nature of the business.

Value can be derived from -

  • The amount of cash the business is going to generate in the future, say 5, 10 years, etc.
  • Assets it owns and value of it
  • Dividend

It is a rational way to invest to progress in the investment journey.

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86

There is a lot of noise around war and geopolitics.

I thought to remind us to focus on Opportunities, rather than carried away by news headlines

What really matters in investing is to ask -

  • Is the company generating consistent cash flow?

  • Is debt under control?

  • Is management allocating capital wisely?

  • Is ROCE healthy?

  • Is the valuation giving us a margin of safety?

    If the business model is strong and demand is durable, short-term fear does not destroy long-term value. Prices may fluctuate. Business economics usually move much slower.

Have Peaceful Investing!

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