'Stock Markets Bring Out Your Animal Behaviour' | Siddhartha Bhaiya | I Did It My Way Ep 10

I say the stock market is pretty raw this is where our animal behavior comes out in the stock markets you don't think rationally with your salary you can't afford to buy a house in Bombay [Music] ever I equate a bull market party to a free buffet with alcohol on the house the party starts at 6:00 and ends at 12:00 shop and you know it's free unlimited boost but you can't wait till 11:30 cuz 11:30 things start getting messy when everyone is drunk the day steel authority of India starts making profits the sector has peed out is the most inefficient player and jsw steel makes losses the sector has bottomed out hi guys welcome to another episode of I did it my way today I have a very interesting guest with me someone who has outperformed the market in the last one year since Inception sidat bitas is here with me and of course a lot of people know equitas because of sidhart not the other way around sidat thank you so much for being here with us on the show no it's a pleasure Sonia to be on the show and you know uh for the uninformed viewer let me just put it on board right your PMs and aif has been one of the best performing in the last one year I think your PMS has given 100% returns compared to the Nifty at 23% how did you get it so damn right so we've not not done anything and Sonia more importantly you know the one-ear returns don't matter to me what matters to me is our 11e kager which is close to 35% so one year in fact we've not added any risk to our portfolio the markets have done well so I was just discussing with my ex- boss and we said you know to government you know we are kind of benefiting by being in the right country at the right time in the right industry so last one year has been good but I'm more proud of our performance over the last 11 years so in the bull market everyone does well right it's in the bare Market when you really find out the you separate the wheat from the shaft so to speak uh you think we're headed into a bare Market I think we've had a fantastic four years more importantly I think Co you probably saw what a two-month sharp draw down a lot of money has come into the stock markets in the last 6 to seven years which has never seen a bare Market I'm worried for that money uh the kind of P multiples that I see in India right now I've never seen anything like that in history neither in India or anywhere in the world for such a prolonged period of time you have stocks quoting at 50 70 80P multiples for a sustained period of 2 3 years I don't think so these valuations is sustainable you stopped taking money into your funds right why couple of months back so Sonia we have many minimum return expectations from ourselves right now we don't find enough stocks with margin of safety and it is better not to accept money you know so that's that's that's the only reason we don't find enough opportunity see we're not bearish on India per se India is a fantastic country it's a growth market for 20 years of my investing career I've invested only in India but at this point in time there's so much money coming into the stock markets and we get a lot of call from retired people who might have a small exposure to the stock markets but they want to take a big exposure to the stock markets through us which is so in a way low the low interest rate environment is pushing people towards the stock markets because relatively you he your neighbors doing well right the foro drives you to the stock markets and the best part about the or the worst part about the stock market is people only go about talking about their winners nobody talks about their losers that that is what it is right but you said you're worried about the new breed of investors that have come through because they've not really seen a bare Market what worries you what worries me is look my wife is techi she does you know she runs an organization which teaches coding for kids one of her teachers one fine day she just quit and said I want to start investing in the stock markets which effectively means trading she's an engineering she doesn't know anything about the stock markets but it's a very desperate decision that she's taking and My worry is people are going to put 7 8 10 years of their savings at one go and then they're going to bear the consequences so I've seen it time and again you know I love speaking to people about the stock market experiences people who have lost money in the past and you're seeing the cycle repeat this time so stock market I I say the stock market is pretty raw this is where our animal behavior comes out in the stock markets you don't think rationally or rather at the bottom and at the top people don't think rationally what explains that March 2020 people only wanted to own a select few large caps and today people only want to buy small and midcaps and psus and psus and such a dramatic transformation in 3 years it's like people have just wiped their memories clean so you know someone was saying the other day that everything that didn't work for the last 15 years is working now whether it's defense Railways psus how how do you justify that so how do you justify that to be honest with you to make money in stock markets you need to be extremely extremely contrarian and I have own a few psus on my personal list and I just bought them you know when their IPOs had come and after the IPOs I just bought them and the amount of dividends that I was getting whenever I used to file my inter uh you know uh annual returns I was amazed you're getting like 15 18% dividend deals there was too much value at that point in time in this so you have to be extremely contrarian in the stock markets you have to be a cynic you have to think that nine out of 10 people are wrong it might sound arrogant but you have to think that nine out of 10 people are wrong you have to question everything you have to question everything and you have to you have you know so you have to be a cynic and you have to you have to be extremely cynic and you have to be extremely optimistic that Anything Can Happen who would have thought that psus would be 10 Baggers in a year's time and Who would thought that the small cap index would rally 700% in 3 and and a half years have we reached a top now you think in small and midcaps I wish I knew that answer Sonia nobody knows that what's your best guess again as I said I I could never have nobody could have ever predicted Co bottom nobody even a year back would have predicted PSU is rallying this way so you don't know forecasting is a Folly all you have to do is make an you know you have to make how do I say you have to just take calculated judgments and be rational so in our funds we've moved to close to 20 25% cash and we've also stopped inflows so the market goes up our theory is that the market goes up from these levels hopefully we should be able to outperform with being 70 75% invested if the market goes down then we'll have enough dry powder to invest at the right time okay so you moved 25% to cash now okay so you think it's going to be a long draw now out either consolidation or correction what was the rational behind moving to cash it's it's you know Madness of the crowds it is the IPOs that are coming through qips the amount of money that promoters are raising in some cases promoters are raising more money through a qip or an IPO than they have through 10 to 15 years of running their operations so which promoter would want to run business you know 15 years you have to talk yeah and then one fine day overnight through an IP or a qip you can raise thousands of crores true true but uh you know just going back to where I started right your PMS has given 100% returns in one year while the market has risen 20% huge outperformance from your end how do you catch Market cycles and how do you catch sectoral uptrends so Sonia what we have is we have three three pillars to our stock picking first and foremost is value second is a contrarian approach to investing and third is growth okay the thing is the first two are fairly predictable the third you cannot predict so one you want to buy deep value second when a stock is in deep value it is also extremely contrarian like psus they were deep in value you're talking about 15% yields 10% yields on ntpc and cold India the some of the biggest companies in the country so they were deep value they were available at two three times earnings and they were extremely contrarian nobody wanted to buy them then what you have to do is it's like fishing it's like fishing you have to cast The Bait and then you have to wait for the fish to come and the fish in this case is the growth and once the growth comes in Market goes berserk as far as P multiples are concerned but fishing also needs a lot of patience so how long do you wait for growth There's an opportunity cost there as well right so there are times where you know you go to WR immediately there are times you have to wait 5 years 6 years for a lot of our stocks you know the my portfolio in March 2020 and my portfolio today is pretty much the same a lot of the stocks that we owned that day we still own today it's only that people's perception about those stocks have changed not our perception you think uh if it's not a Buy and Hold Market anymore because you know 10 years 15 years ago if you had bought a sector and held it through the decade you would have perhaps made a lot of money but now it doesn't seem like that's the case anymore what's your best guess on how things are shpping as you said Sonia this forget Buy and Hold This is not even like a buy market for me I've never seen I'm telling you this is the first time in 20 20 odd years of investing that I have not looked at a single quarterly result why is that except for the companies that we own I just don't find any value I don't want to get I'm very very clear when I look at this 70 and 80P multiple I so we started looking at the international markets onlyy and the kind of opportunities that you see internationally and I'm talking about East not I'm I'm not talking about the West which markets in the East it's it's all the markets it's you know Hong Kong it's Indonesia it's Korea because China is under a lot of pressure now so it's the valuations are insane they're so cheap and same thing extremely contrarian deep in value you have to fish you have to put the bait out growth at some point in time is going to come in didn't it come for Japan Japan's now made a new lifetime high after so many years so in the Indian market if you look at this combination this troa deep value extreme contrarian and growth are you seeing any sectors that fit into that bucket nothing nothing right now a year back I would have told you a few now see it's this is where the efficient market theory in bull market Efficient Market Theory works at it it's best companies come out with their 2030 vision and the stock markets discounted uh immediately immediately so you're saying this is not a bull market anymore it I don't know probably does feel like it it is a bull market right it's a roaring bull market now I don't know when the tight turns I have no idea as you said we've made phenomenal money for the clients over the last last 10 years we've bought into pessimism at every single point in time right now there's too much optimism and when there's too much optimism you cannot make money but what is the concern because everything seems to be very hunky dory right now you have the government that perhaps is you know in all likelihood coming back to Power macros are improving compared to the entire Emerging Market space India is looking pretty good so where does the problem tell me which bull market is not picked on good news you wouldn't have a good bullk Market Peak if the news was not Hy Dory what was the greatest bull market that you ever saw in the 20th centur 207 is what 1920s the US you had the greatest depression after that so as you said the government is doing a fantastic job right but any bull market also attracts a lot of unscrupulous elements Fly by Night operators who want to become rich very quickly aka the people who are raising money IPOs are coming at 80 100 P multiples in some cases no profit So you you're going to see you know we going to see a lot of people swimming naked after this tide ABS away so what do investors do now if you want to prevent yourself from swimming naked when this tide ABS what's the best way to open approach it my this is don't go Lock Stock Barrel into the stock markets at this point in time even if you are excited about the opportunity spread it out I've personally this is irrationality IAL talked about irrationality right I know so many people who took a call in March 2020 that I just want to get out of equities sold completely and there's so many people right now who are taking calls like I just want to be in the stock markets All In All In stock market plays with your mind it plays with your mind it it it you know it brings out the animal in you we think with our animal brains we don't think with our rational brains in the stock market the greed and fear we all know we've got to be greedy when others are fearful fearful when others are greedy but we just can't do it when it when it is there right so to be honest with you again I don't even listen to myself I follow a good thing I just I just follow my discipline because you look at it everything is Hy Dory right now you can't find a fault with the economy so you know we'll come back to the markets but I wanted to know a little bit about your own Journey as well how did you start how were you always passionate about the markets and what led you to equitas okay so Sonia I did my CA right and I was I was you know born and bought up in a suburb near Bombay which is like 40 km from here luckily I had a good upbringing very good education middle class background all my friends and schoolmates were from a middle class background so we had you know we did not get everything that we wanted but we had everything that we needed so Focus was an education got a good education had a good peer group as far as school is concerned did my CA and once you're doing your ca everybody gets attracted to the stock markets I don't know if a chartered accountant who's not dabbled in the stock markets or who doesn't dream of being in the stock market a natural progression the natur natural progression and to all the Chartered Accountants out there all I'll say is you got to be very desperate so we put out this for resume and we get 5 thousands of resumes but there are only three or four people who are really really passionate and desperate for that and I was one of those guys I was looking for a job and I didn't want to spend Sonia my life traveling from Amna to VT commuting four hours a day so I said what's the best way get into the stock markets right that's where because you with your salary you can't afford to buy a house in Bombay ever so g into the stock markets was very difficult it was a very very tough uh period it was just after the dot you started by uh trading on your own no so I start uh I figured out what's the best way become a research analyst I got into Sal side started working as a banking analyst again that was a very good thing that happened to me because once you're a banking analyst you get to understand the economy a lot more better so started with the banking analyst and yes and then that's then that's how the journey began then after a couple of years of working three years of working as uh a banking analyst I went to my boss I told him I want to do small and midcaps also and LU I had a very good boss Imran he said yes go ahead do it he didn't stop me and since then I've never looked back so you've been interested in small and midcap since a very long time oh I've always I've done that in the last 20 years even in March 2020 when everyone quit so when you identify a good midcap right where conviction is high confidence is high there's value there's growth everything when do you decide that okay this is it when do you sort of exit a stock that seems to be a big problem that people have you exit the stock when you see the opposite of those three first two things when you no longer find Value and when you see that the stock has become extremely popular you know earlier it was the local train where you used to hear about stocks and you figured out okay this is the top now it's Twitter you open Twitter and when you see your companies trending or people discussing you know you're close to the peak you know you need to exit at that time yes probably or start taking some money off the table but is that the same way to approach Market cycles and sectoral Cycles as well how do you know when a sector is speaking how do you know there's only one way to know for me in steel the day steel authority of India starts making profits the sector has peaked out is the most inefficient player when jsw steel makes losses the sector is bottomed out and it's true all Industries I don't buy this argument that all Industries are growth Industries all Industries are cyclical all Industries go through cycle even media 5 six seven years back media stocks were supposed to be the growth stocks and then all of a sudden came Netflix and Ott and the valuations crashed you got opportunity we bought them and they're doing well now yeah that's true actually but then you also have this fear right when valuations are good of a company generally the fundamentals are not great so at what point do you decide that okay you know I'll buy into this despite it being cheap fundamentals are not that great but I'll still take that risk so chemicals for example right yeah I mean not doing that well right now but valuations are not bad compared to some of the other sect again as you said that's what I'm telling you Sonia that Cycles are pretty long they are longer than most people's memories so if anyone thinks that the chemical sector has bottomed out I'm sorry bad news chemical sector did well for 7 8 10 years I have personally bought naven Florine 500 rupees 10 paid up with 50% net cash on the balance sheet at at eight times earnings today it is what 60 70 80P multiple just because they did well it's a cyclical industry at the end of the day PE whether it is automobiles whether it is it indust IT services whether it is chemicals whether it is banking these are all cyclical Industries why have Banks not done well in the last one year because a lot of the money has come to the stock markets they're struggling to raise deposits but you think banks will struggle for a while I think so I think so see it's a you know chicken and egg situation for banks if they don't grow for them to grow they have to aggressively increase their deposit rates and for deposit rates to increase the stock markets have to crack some of the money which is coming into to uh the stock markets has to go out to there has to be a balance in the economy so while 5 6 s years back we needed money come into uh to come into the stock markets today excess of anything is bad today we have excess money coming into the stock markets which could affect the productivity of the country at the end of the day Banks provide working Capital Loans to Industries they finance projects if there's no this available over there then how do you you know how do these companies go grow so banks are going to struggle as far as their uh deposit growth rate is concerned so yes and again the same point a year back what was the what was the you know the call that if India has to grow if the market has to go up banks have to do well wasn't it there have the banks done well no they haven't has the Nifty done well yes it has so anything that appears like a sh shot trade look looks appears like a no-brainer never works Market doesn't oblige yeah but what's your view on these new age companies because again over there right contrary to perception they have done exceptionally well many of them zato PB fintech delivery Nika all reporting profits now uh as an investor do you see scope here so one I look at the international markets Sonia and I find similar companies at much lesser valuations over there so I would rather put our money over there in similar companies second there's some businesses again I I'm a value buyer I don't they might have turned a profit but where the valuations where the valuations but don't you think some of these P multiples that we were used to say 5 years 10 years ago don't you think things have changed now purely because of the kind of growth that these companies are seeing and the earnings that they reporting where's the growth what what kind of volume grow growth as Hindustan L delivered over the last 10 years 4 5% I can show you globally anywhere in the world fmcg companies at onethird the valuations of you know a Nestle or a l and the growth rate is not that diff I can understand if it's in Nvidia or something like that where the growth is 100% Plus show me any of these companies which are able to grow at 100% it is just that there's too much money that has come into the Indian stock markets I think s Narin made a very important point that you have you know people who started investing before 2013 and people who have started investing after 2013 you know the valuation this is completely different and I'm a firm believer that you know in the long run it all you know it's reversion to the mean I'm sure there's value somewhere in this market now there are new sectors which are coming Sunrise sector so to speak right whether it's electric vehicles renewable energy big Focus area in defense Etc I know the stocks have rallied but I'm sure there's some value somewhere there might be do I find them no I don't find them to be honest with you right now I equate a bull market party to a to free buffet with alcohol on the house okay the party starts at 6:00 and ends at 12:00 sharp and the smart people get in at 6:00 eat their fill and you know it's free unlimited boost but you can't wait till 11:30 cuz 11:30 things start getting messy when everyone is drunk so you're at the end of you know I've had my full is 2024 that 11:30 of the party tell me that as you said I wouldn't even wait till 11:30 I'll be happy going back back at 11:00 because I came in at 6:00 but you're somewhere hinting that we are at the end of this party right I don't know I can be wrong and I don't want to you know I'm My Views can be wrong all I'm saying is I'm worried about the markets I don't know when this ends but then if equities won't do well other asset classes will do well gold maybe debt right everybody's looking at that so which are the other asset classes that I'm a long-term Bull on gold I really feel it's a great uh and you know credit and kudos to the Indian Housewives who've HED gold over the years because it's one of the best Hedges against inflation is the best hedge against money printing so I'm a big the amount of gold that we have in the world is very finite so any excess money printing that happens get gets captured into this real estate should do well but when you want to invest in gold is it better to invest Through The Sovereign Gold Bond route rather than physical gold you think oh 100% 100% you know you own physical gold then you know you have sleepless nights where do you store it yes so it is better to always invest through I I did a lot of gold ETF investing for my uh you know for your kids for a couple of years I don't do anything for my kids that's a that's that's another story you so what's your strategy with your kids you're not you're just going to educate them and tell them go friend for yourself yes I don't Sonia are you me and I see a lot of people a lot of my clients are first generation entrepreneurs everyone in my office comes from a relatively humble background first generation wealth creators also wealth creation or or the guy you know the biggest challenge in India is there's a lot of well disparity 1% of the country is extremely rich the rest is uh this and as Buffett said that you know we won the ovarian Lottery we got what if we were born in Aslam do you think you and me would be here we wouldn't be here right so my kids are lucky that they got in a good family but there are a lot of other kids who don't have the same this so to me yes that's a very very important thing that uh I like I want to give them an opportunity to become self-made but see kids come with that understanding of the privilege also right they see it all around them so even if you don't provide the means if they know that they have that privilege is is there going to be any desperation for success so to me uh Sonia deprivation is one of the greatest motivators for Success like if I wasn't deprived if I had I just tell people that if I had house in Mumbai I wouldn't be where I am at the age of 26 you're getting married and you don't have an house you know you kind of have to struggle if I had an house and I see so many of my friends who who had an house whose parents had an house they did not succeed so well because there's no you can't just buy a house in a city like Mumbai on on your paycheck you have to work really really really hard so deprivation is a big tool for success but at the same time while I cannot deprive them because you know I can't change their this but I do not want to put everything on a platter for them so they'll have to struggle you hearing it girls well you know I mean that's this that's that's a common problem in every household these days right kids have everything so it's it's such a fine Balancing Act to make them on one hand realize that they have everything and on the other hand create that need for them to kind of grow on their own but U you think that was one of the reasons why you reached this level of success because you came from such a small background and can it work any other way I'll tell you why like I speak to so many people right so many successful people and the Common Thread is that you know I never had had anything and that's where the hunger came from so does it mean that if you have it all you there is no scope for Success there are always outliers there are always every rule has an exception so there may be somebody who's got everything and he might still do well but those are Rarities and there might the biggest advantage that you can have in a country like India is being born middle class that's the biggest single biggest Advantage because you get access access to good education and that changes everything it's the biggest Advantage if you're born poor okay there there might be somebody who's really poor and who might do well as well but again that's a rarity you see majority of the successful people they come from a middle class background who had access to good education right so for me 100% it is that I got access to gooded education I was surrounded by good peers in school I had good friends growing up whether it was my article ship days whether where I was working it it middle class is privileged trust me I agree and I deal with a a lot of rich people and I can tell you that you know uh it's it's they say money is wild it is it is so what do they say does money really buy you happiness uh no happiness is a state of mind Sunshine buys you happiness get a lot of vitamin D no I think money does not necessarily ensure that you you are happy what after so many years after meeting so many clients who are rich who are successful I've realized that it's eventually how your kids turn up decides how successful you are or or how successful You Think You Are yes no the world thinks you you also feel happy you don't want your Sunset ears you know with a child who's addicted to drugs or who's got a drinking problem right so you know my parents are more successful than you know probably I'm going to be you never know that that's just your fear right a lot of us live in that fear but coming back to the stock market right what are the virtues that one needs in order to be successful in the stock market what are the virtues oh it's it's a I say stock market is 10% fundamental analysis 10% technical analysis it's 80% your mind your mind how do you treat money like for me I'm dispassionate about money what does that mean it doesn't make a difference to me how much extra money that I make that's because you have it even when I did not have it so what were you passion about passionate about then the money is you know money is just a byproduct it's your career it's what you want to achieve in your life if money is your sole objective you're going to falter at some point in time but if you you have a career right you're a journalist what you would want you would want more money or a better career as a journalist would you want to be known as the number one journalist in the country would you want to be known as and then when you reach there you automatically make what's your goal to do good work my goal is to become to be the best fund manager in the country whether I'm going to achieve it or not is a different thing but that's the goal that is what I wake up every single day and think of money is a byproduct so you don't chase money I don't chase money the it's and Sonia to to be honest with you I am I'm in a profession where you get disproportionately rewarded for being right but you also get enough and more brick bats for being wrong right that's that that comes with uh any profession where you put out your performance in front of the public you get you get the Kudos you get the you know Applause right but at the same time you're also forget me look at somebody like a verat or a Rohit Sharma they are more in the spotlight now would you rather be a verat kohi or a Rohit Sharma or would you be in a 9 to5 job where nobody knows what you're doing so I say I'd rather have ups and downs Downs highs and lows rather than live a mediocre life so if I wasn't this good I wouldn't be on this show but you said you're dispassionate about money how did you get there the realization the realization that luckily for me I did not get money at the right time it was always a little delayed so maybe if I had too much money in my youth I would have gone out partying a lot more that time you didn't have the money but it came a little later and you realized okay you know it's not good for your health but in your youth you can take anything maybe in my 30 is if I had a lot more money maybe I would have bought a fancy car but right now while you have the money you realize no it's not a good you're not setting a good example for your kids so it it's just that okay you know how you treat your money how you deal with your money but in your profession right it it's tough because you can't obviously put up the same kind of performance every year this year your PMS is outperformed in a big way there's a very slim chance of you repeating that performance yes not not not not going to happen so how do you deal with that stress how do I deal with the stress you know be afri with with our clients about what their expectations are we never told them that we expect it to be 100% this year whenever new people come in and we get a we getting a lot of new inquiries of late and we one of the reasons we stopped it is because we realized that this is a lot of hot money as well people who haven't seen uh downturns so what we did is we stop the fund we told people put in your interest and when we open up we will call you back and I have a bet going on with my team that of all the people who have registered their interest not even 20% will give us money when we ask for it because that's when the market will fall so badly yes right so but that is that has always been in hindsight the best time to buy a market when it crashes bad right so most people don't understand how difficult life is for a fund manager you don't get money when you want it and you're being chased when there are not many opportunities so I think from what March 2020 for 2 years when we we did really well our portfolio is up to to 50% over that period we got zero inflows imagine you as a fund manager you know your stocks are going to do so well we are big into infrastructure cap Goods defense pipes you know Railways is sitting on there and nobody's listening to your story it was damn frustrating at that point in time but that's how it is so next time you know you anyone out there you know me or any of my fellow fund managers you shout abuse at them please understand that life is very difficult for a fund manager I'm sure I'm sure it must be managing your own money you must be having a lot of sleepless nights for sure again I said you know so to to ensure that I sleep well I became dispassionate about money you have to if the kind of profession that you are in but tell me about the psychology of money right the fear was highest at in March 2020 but that was also the best time to buy if you had gone all in you wouldn't have to work a single day in your life right if you had put all your money to work in March 2020 but how do you deal with that fear how do you overcome that fear you so as you said you know I'd say first never go all in doesn't matter what if you'd gone all in in February because the markets were attractive even in February by March you would have panicked and gone out because when you put in money you probably put in 8 10 years of your hard earned money and when your portfolio goes down you're staring at a very Bleak future so my suggestion is uh I've invested Sonia every single year for the last 20 years into the stock markets and it's rewarded me handsomely so how do you invest through through our fund so I invest last four five years since we started our AI five years back I invest only directly into our funds so I don't do direct equities anymore you don't believe in it of course I believe in it but it's through the fund so there is no you know uh there's no conflict of interest okay no that way no I'm saying between active and passive you you think think passive works better a disciplined approach works better you have to be de as you said a lot of these things everybody has an asset allocation plan and you know every but then you get into a bull market or a bay market and then you throw the asset allocation plan out of the window so you need to have a very very stable hand whenever you're making an investment what you typically do is you think of the upside otherwise you won't play like suppose you buy thousand shares of Reliance Industries first and foremost you're buying you're buying because you're bullish so what do you think you say okay this is what you know I expected to go to say 3,000 rupees or something but you have to train your mind to think what if Reliance goes to 1500 you have to think the other side of the trade you have to train your mind to think what can go wrong when you buy not what can go right so you said that you have a very disciplined approach to investing for the last 20 years you've been investing every year in your fund right through the Sip route I'm guessing yes uh any other investments in the sense any other asset classes that you're heavily invested in uh what is your own asset allocation strategy so I'd say more than 95% of my net worth is TI to equitas so I I believe in having a basket of eggs and watching it closely so I'm a firm believer in equities I've always in invested right now we started looking at International equities we going to launch a fund which is going to invest abroad because we find valuations more attractive at some point in time majority of my investments are in India for sure but I'm an out and out equities guy and I don't want anyone else to become like that because I understand it I understand understand it right I've spent my I can handle a 50% draw down on my portfolio and not you know lose my sleep not many people can do that at what point do you think you will have enough money to retire I have enough I had enough money to retire when I started equitas so I don't work for money anymore I told you son as you know it's it's after after a point in time you're never working for money do you think mkes Amani and goam adani work for money do you think Elon Musk works for money you don't you you have to have a higher objective in life you live once you have to make the most of it and what is your higher objective my higher objective continue to be a great fund manager right to build equitas into an organization which everyone is proud of right as a team we super super proud of what we do our be after the performance that you've seen our clients are very proud proud of us our friends are very you know people in our office go go and you know whenever they say we have we work at equitas you know they they talk with pride we want to ensure that you have any mentors in the industry a lot of them my mentors but I never like meeting my mentors I'd never my I'd say Warren Buffett is my mentor but would I go to Omaha to ever meet him never because I know Buffett would never do that he would not spend so much money going there he would rather invest in the markets my best way to learn about Buffett is by reading him why would I want to go and meet what would I get out of meeting Warren Buffett nothing but if I read I get to learn so much so initially when I started Sonia I learned about stock picking from Warren Buffett when I started my career when I started equitas I learned about building an organization from him when I read his letters reread his letters now when I read Buffett again I realize how to live my life you know manger Liv till nearly 100 Buffett is 93 you they became Rich because of the longevity not because of taking more RIS started investing very late in his life relatively yeah any other mentors a lot of them lot of them see I have I have a list of Role Models if I open my this and I encourage everyone to write their list of Role Models so I'll give you my list of Role Models I and it is from diverse Fields so it's Steven Spielberg Christopher Nolan Glenn mcrath Ricky Ponting liel Messi I love him right Michael Phelps you say in Bolt Michael Jordan Warren Buffett Peter Lynch amitab batan for the longevity of his career Muhammad Ali Elon Musk jobs Gates Bezos something to learn from everyone Alex Ferguson Pep Guardiola Deepak par adya Puri en Chandra Jeffrey Archer Michael Jackson Taylor Swift I love it very diverse yes why not so there's so much to learn from everyone around you and you don't need to meet them look at Taylor Swift she's a phenomenal isn't she indust whole Industries are running because I think once once she retires she might probably end up becoming bigger than Elis Presley and Beatles and Michael Jackson I'm sure yeah she's already like she's barely 30 years old yes crazy isn't she it is it is but um okay so just before we wrap up a couple of things um so you know if we have so many young people who are entering the stock market right retail investors Traders they've never seen a bare Market what's your advice to them go slow again I said nobody's going to listen to me there's no point of there's enough advice out there you know you asked me to come on the show and I said all that I'm going to say is already been said or written before so people I read this book by mgan hous and I would highly recommend everyone read this know same as ever and he said that we we can learn from other people's experiences but majority of the people don't do if if only we could learn from other people's experiences we would be a lot more wiser but unfortunately nobody does that we all make people have to commit the mistakes so my advice is go slow but nobody's going to listen to me no that's why you're here to give us this advice right so you're saying go slow in the market take it easy because this is going to be a bit of a rough ride from here on I said you've got a lifetime to do what you want to do why do you want to make all the money immediately if you think the stock market attracts you spread it out over 5 years 7 years 10 years you can invest every single month and stay away from direct equities if you don't have the time and energy stay away from derivatives I think that's that's a big socio economic problem that we're facing in this country right now right unfortunate but all the broking apps have become slot machines people have to open their apps at 9:15 and put a trade correct I just put out a tweet you know derivative volumes in India with respect to anyone everywhere else it's I think it's it's become a disease it's become a disease derivatives in India has become a disease and we need to curtail that otherwise there will be serious serious consequences why would you say that a lot of people going to lose a lot of money it's like gambling it's like Lottery you have daily expiries you have weekly expiries are you kidding me you know you tell that derivatives are hedging instruments how do you hedge in a day how do you hedge this these are pure gambling instruments these are pure gambling instruments so this has to end so what do you think the regulator should do I think you know just I don't know I I have no that's for the you know The Regulators are the doctors it's for them to you know I see patient with problems and this could this is something that could derail the Indian economy as well this could derail the Indian economy as well so derivatives and the mass volumes that we're seeing over there okay uh in terms of sectors you know just quickly before we wind up um there's so many sectors which have done really well right whether it's psus defense Railways um huge gains you think the best is over very difficult to answer that very difficult to answer that I could have told you back in 2020 that look some of these companies were available at below cash some of these companies were available at 0.1 times market cap to sales but uh right now they pric to Perfection none of these stocks factor in any room for bad news and if at all there is bad news you could see Heavy cracks in the in the this said very happy with our economy the way we are doing our culture right our focus on education as a country but at the same time I'd be vary let me put it this way just be a little very everything comes at a price yes well on that note thank you so much sidat for joining us it's really a pleasure speaking to you we a pleasure being I enjoyed the conversation so much to learn and hopefully we'll speak a lot more on the channel as well surely yeah thank you thanks Sonia it was a pleasure of being on the show thank you for watching CNBC TV8 for all the latest news and updates do follow us on our social media [Music] platforms

Channel: CNBC-TV18

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Id: ZsIbB6ZeH5s

Length: 48min 46sec (2926 seconds)

Published: Tue Feb 20 2024