Investment philosophy and update on portfolio

Hi everyone,

We have had an interesting time since I put up my recommendations on valuepickr. Our stocks outperformed the market notwithstanding a huge set back in arshiya international. However I am not too perturbed by that for the reason that:

a) I learn from history or so I believe. On 26th December itself in a posting on is very blog, I wrote how globalization and other black swans have increased investor risk in any co. There is nothing as a free lunch or a fool proof investment in such times and had accordingly advocated the need to be both invested and DIVERSIFIED. Much as I am quite conversant with traditional books on investments recommending a concentrated strategy, we are no longer in a world of calm and certainties and almost any co is subjected to too many black swans.

b) while I continue to hold arshiya, on my twitter I’d I constantly discouraged add ons once the black swan set in. I follow several motos, one of which is my summary statement to be: in terms of greed and fear, let not one stock make or break you. (If it does make you, remember some part of it was random and don’t over credit yourself). History will teach you what happened to facebook when mark wanted to focus on wire edge, or when Larry wanted to sell google to yahoo for 1 million, or when Nokia moved from making green boots to mobiles.

c) if you haven’t leveraged and invest with disclipline, and with some effort to know why you hold in a balanced manner, you will inevitably do well. Ironically, our portfolio went up when with arshiya’s decline as some of the other convictions including amara raja, satyam, tech m, unitech ( a recent addition at 32) to name a few made more than up. You can track my recos on twitter although I am trying my best to increase my participation here and pen down more thoughts.

d) I follow a strategy of holding some cos as core and a very few as trading. My definition of trading is not a technical call, I rather not even dare to do what I don’t understand a clue about. Trading for me are short term mis priced bets which I buy on delivery for atleast a 20 percent if not more upmove. A recent example would be ACG network, a stock recommended by me at 360 rs on a per bonus basis. The stock now trades at 220 or 440 which was precisely the target I wrote about at 360. I use such bets to increase my cash flows and to maximize my returns. Other bets that worked include hdfc warrants recommended multiple times at 60 bucks, then 48. I encased both at almost two to three times the value.

e) my core picks are not in nd outs. I usually remain invested in them till the story remains intact and don’t get blinded by sudden moves. Stocks like Wockhardt, tv18, den, strides acrolab, Atul auto, Mayur etc are examples. I own indusind, hdfc bank etc longer than I can remember.

f) I don’t believe in or follow experts on tv. You guys are far better as your basis is some knowledge or research while tv analysts are all noise. I strongly recommend you to read The SIgnal and the Noise as a recent book that I read.

G) investing is an ever evolving process. My lessons I have learnt are to keep ideas simple, diversify, learn from history, be disciplined and never try to time what otherwise seems convincing.

I continue to wish you guys happy investing and am pleased if I helped anyone do better. I do not want to boast about my absolute returns as no matter what the sky is always above.

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7 thoughts on “Investment philosophy and update on portfolio

  1. Pravin says:

    Hi Safir- “let not one stock make or break you”.. this really thought provoking and tells lot about portfolio concentration.. plan to follow ur tweets going fwd..if possible could you please pen down ur overall arshiya exp. and did you see any signal of black swan coming for it.. any learning from it… Thanks for sharing ur thoughts.

  2. M M LOHIYA says:

    You are doing a good job. Your efforts are appreciated.

  3. gold invest says:

    Hi there, its nice article concerning media print, we all know media is a impressive source of facts.

  4. Richa says:

    Written with such lucidity…thank u for providing us with such an informative read!
    Like the concept of core holding & trading…but what do you exactly mean by being “disciplined” when investing?

    • safirpicks says:

      Thank you. By bring disciplined it means a) diversify b) don’t overbet or become complacent c) don’t assume anything by taking it for granted d) keep connected to your investment purpose e) avoid the noise of too much tv or analysis.

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