i have a question…what do you think the initial corpus should be for an investor…would you say at 2% dividend rate the corpus should be expense per year/2%
thank you …that helps
i dont think we can assume 2% div yield… thers hardly any quality company (with decent growth visibility) at 2% yield. most of them are less than 1%. or just a little more.
1% assumption makes sense.
Few are rich and most are poor. If you follow advise of most of the people would you become rich or poor?
Not buying residential real estate is good investment decision, but it requires a strong head. I empathize with you. I too have avoided buying residential real estate for the comfort of calling it home.
~good luck!
My two cents on being full time investors:
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Do we really think it would keep us occupied 40 hours a week for evaluating businesses and following, isn’t investments supposed to be a longer term goal with periodic follow-up only. Or it may end up person trying to get into trading activities and we all know well where traders end up in the longer run!
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Even all ace investors like Sanjay Bakshi keep a full time job despite their max. net-worth being in stock markets.
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It takes a lot of courage to do that however short term pain can give you huge returns for e.g if you intend to start your own PMS or something like that and gain enough credibility in the market during the learning phase.
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- Do we really think it would keep us occupied 40 hours a week for evaluating businesses and following, isn’t investments supposed to be a longer term goal with periodic follow-up only. Or it may end up person trying to get into trading activities and we all know well where traders end up in the longer run!
Does “Full Time Investor” mean we have to be occupied 40 hours a week for evaluating businesses, or buying/selling/trading 5 days a week just for the sake of doing it? I dont think so. It just means I guess, that I will be living investing and managing my own capital. Now, I would be picking a stock daily, once in a month, or in a year that depends on my conviction (I like to have a very concentrated portfolio); ya, it’s much easier said than done, but we all like to be financially free sooner than later.
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It was an awesome post Rich Dreamz. Respect. I hope, your post gives lot of courage and insight for prospective full time investors. 
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I’m glad it helped Balaji, I have updated my above post with further thought process, my books list, websites etc. so the information is helpful to wider section of the forum members.
Read from EDIT 2, if interested (Link for the post is given below).
Hi richdreamz,
First of all thanks very much for sharing an insightful post about your approach towards investing and as my philosophy/goals/nature is very much similar to yours so i can vouch that it has directly come from your heart.
I have observed that you are very detail oriented in your posts and they show your passikn towards investing and stock markets. I also specifically like your name on VP whicb shows you have conviction and self-belief in yourself and your goals…
I will definitely personally connect with you in future as i am currently progressing towards my goal of financial independence (as you said everyone has a different life path and different definition) and taking investing as my career (although i believe in multiple income streams so i will also like to have some job along with it preferrably teaching). But for the time being i have one question and like to hear your thoughts on it:
- How much time did you spent investing in stock market before it give you conviction and belief that you can take it as full time? I know genuine passion/interest (not just for money) is a big factor but there comes a point where tou get the strong faith that you can do it, specially in a domain which is very volatile and can enter into bear phase for years. I think you must have test the waters before taking a plunge?
Thanks very much again for your amzing posts on this forum…
I would also like to pay my gratitude to @sunilsurana for starting this thread where experienced people have shared their personal thoughts on their investment journey…
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@richdreamz thanks for providing useful information.l always read your post and gain most knowledge .
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The grave importance of maintaining emotional stability has struck me in the last 2 months. As all indexes have corrected significantly, a lot of relatives who were gung-ho about market prospects have ‘cooled down’. They’ve stopped tracking their portfolio actively and don’t talk about ‘how the market is or where it’s headed’.
Now, this evident breakdown in ‘emotional clout’ (thanks, reacher!) can turn out to be very infectious. There are some who are genuinely concerned about you and hope that everything is fine and there will be others who play the real life ‘bear’. They will attempt to maul you (usually with the ‘i told you so’ statements)
Now, most carry a great weapon - simply ignore ridiculous logic and stay on the decided path. How about beefing up the defence ? Why not head to the giant castle with a gigantic moat.
Meditation !
I’ve been trying to practice Vipasanna and the results have been amazing. As the naysayers can take a toll on our mental health, it is important to ‘flush out’ all the useless emotional toxins we accumulate on a daily basis.
Richdreamz explained the need to have a thick skin and not get swayed easily. Personally, this seems to work to a great extent as a shield. With time, the ability to withstand ‘compounds’ like knowledge and capital.
Any other meditation practice will do just fine. Vipasanna is a personal choice because it is quite secular. You can google the entire practice including benefits.
Hope this helps !
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Some links…
https://www.dhamma.org/en/about/vipassana
"Positive:
Going purely by personal experience, you stop judging people and situations and view everything from a very neutral perspective. You no longer feel hurt or extremely attached to something and can take a very rational decision in life. This doesn’t mean you become emotionless but you can take a decision without emotions playing a spoilsport.
Negative: Nothing specific but you just feel pity at people around you who keep on dealing with petty issues in their lives. Also sometimes you start liking the emptiness in your mind which I don’t know whether it is good or bad.
But honestly, it is a life changing experience and the positives definitely overweigh the negatives."
- A review taken from Quora
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I second the above thoughts. Especially when market turns downside or steep correction or bear phase - many lose interest and get demotivated with I told you statements. However avoid panic, peer comments but be very careful not to catch falling knife. Stick to value investing principles, have patience. One personal experience is that for not so aggressive investors, I mean part time or with job kind of investors, if the exposure to equity is not very high, within ignorable limits then it gets easier to be relaxed. However for an investor having more than 25% exposure to equity will create some sleepless nights for sure. Even top fund managers get nervous when their value picks test new lows every other day !! I like S Naren interviews …somehow his talking style has a calming effect 
I second your thought process. In fact I myself have quit my current job at a Fortune 500 company after 8 years & joining a startup next week. On one hand I’m apprehensive because I’m employee number 5 at the startup & things are uncertain; but on the other hand I love what I do & I know I can work more independently at my new place. This will bring me a rich learning experience & quality skills which I couldn’t bargain at an MNC.
Now, at social gatherings I always receive free financial advise but I open my ears to only those from relatives/people who built their empire from naught. One good piece of advise I have received is to buy commercial real estate instead of residential. And then, make it work for you & eventually pay for your EMIs. Within my distant family I have seen commercial property worth Rs.X years ago now generating the same Rs.X as rent, per year!
Like you I spend on experiences. I do a lot of international travel. I spend on good food. I cut back on many other things.
My plan is simple -
- My new opportunity is providing me with vast possibilities. So I’ll improve my skills at my new job like crazy. One day I might have my own startup.
- I’ll take a loan only if I’m starting a new business or buying a commercial property that makes sense.
- To build the seed capital for the above, I’m investing my savings in equity. My PF has only 2 stocks. I realised that one of those was a result of poor judgement. I’ll get rid of it in the next bull run & will be left with a highly concentrated PF with only one stock, but which I totally have faith on.
- I’ll be accumulating the same stock, be patient, polish my skills & keep my patience. I’m sure I’ll reach my goal of either ending up with my own business or having a good property or with a multi-bagger stock.
The pressure is there only if you let it to be.
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I have updated my post with a small personal incident from which I have learned some financial/portfolio management lessons which could help some new investors.
Please refer to EDIT 3, at the end of my post (link below).
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Very excellent post.l have no words to express my gratitude.can you give your email I’d l want to discuss regarding myself.
Thanks
Nitin Choudhary
Dear Sunil
I understand these are your personal emotional pains. I wish you all the best in your ventures and the reason I am responding you is recently when I quit my job (29 Jan was my last working day) I sent a mail to my friends and colleagues. With due permission from @adminph2 I would like to reproduce here.
There is something new every day, we need not have something special inside cranium or even a cacophony to identify the “new”. Soaring above territory and work within cannot be a fathom. Reach out few steps to switch on your live……passion can only be a handful.
I couldn’t muster my courage all these years to tell myself that temperament, emotions and irrationality cannot be delimited by frugality. The traditional risk management intrigued me to draw line between independence and passion. Yet I am here going out to fight a virtual monster with bad emotions and temperament. More so it does not have a physical existence!
I am going to stand with both feet against aggression of stock market, BUT I have a trump card……I don’t need roulette wheel to conclude my trick. Hundred years on value investing is winning against whims and fancies of market. Because I am trying to buy business not a price sticker! That’s my idea and that would mean end of active employee career for now.
Where next?
Still a terrain, starting from surface ignoring past success and failures (except experiences) would be sanguine way to look at life.
A. Value Investing: this is my identity at least to me. I am among those proud value investors who continue to practice them with an optimism to see a better world. I will spend dedicated time for value investing and that keeps me going.
I been trying to raise awareness and know how towards equity investment, do not hesitate for a second to call me. Still I repeat stocks properly selected and with discipline, hard work and blessings can create unimaginable wealth and freedom. Treat them as business stories where you are stakeholder.
Does this mean I don’t have nemesis or plan B? My guruji told me when plan A is not started why to think about B,C, D etc. I refrain from writing about my Guru who literally influenced each of my decision. Whether it’s cash flow quadrant, value investing or even philanthropy he convinced me money is only unit of account. He is a true fan of Chandrakant Sampat so am I.
I promise you, I will remain same whether it’s my lifestyle or endeavor. And to do that I need your wishes and love.
Of course this is a truncated version of full email. By the way I live in a rented house, I don’t have a car…many times I travel by public bus. This is despite a good size portfolio, not trying to make a point. Just wanted to say investing or passion is an identity. Nothing more or nothing less.
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I am also in the same boat and fighting with myself and am in my mid thirties. I have a quick question to those who are giving up their jobs and moving to full time investment.
What is your annual expenses compared to your equity portfolio in terms of percentages and also your networth in terms of percentage.
Also, to what extent you depend on dividends and what is the dividend yield on your portfolio?