Film actor Rajesh Khanna bought a bungalow in iconic Carter Road in Mumbai for Rs.3.5 lakhs in 1970. His heirs sold it recently for Rs.85 crores. The property has multiplied by 2,428 times or an annualized return of 19.38% over 44 years.
Samudhra Mahal in Mumbai is another expensive property. A flat purchased in 1970 at Rs.700 per sq.ft was sold at Rs.1,18,000 per sq.ft in 2013. Money multiplied by 168 times in 43 years. This works out to an annualized return of 12.66%
In 1963, Godrej paid Rs.1 lakh to buy his first house, a 2916 sq.feet apartment at Usha Kiran, Carmicheal road, in tony South Mumbai. In 2011 he sold it for Rs.25 crore. Money multiplied by 2500 times over 48 years or an annualized return of 17.70%
In Dalal Street, Mumbai a sq.feet was Rs.100 in 1980. After 34 years, it sells at Rs.27,000 per sq.ft. Money multiplied by 270 times in 33 years. This works out to an annualized return of 17.90%.
The first three properties can be bought and owned by cream or elite of the society who are worth at least tens of crores, mostly hundreds of crores.
The last property in Dalal street; your father could have bought with whatever money available at his disposal. You can buy it even now. Your son or daughter would be able to buy it even 20 years down the line. The last property is Sensex. A sq.feet is a metaphor for one unit. If dividend yield is also included (assuming 2% CAGR), Sensex would have delivered 20% annualized returns over last 34 years, higher than the most expensive prime properties in the country.
Good mutual funds and many stocks have delivered returns far superior to Sensex itself.
Power of equity is least understood in our country. If you can withstand notional loss (if you don’t book) in portfolio during bear markets, not worry about daily price movements, it is possible to make much better money than what can be made out of best of real estate.
Give at least the same importance to equity as you give to real estate.
You don’t mind holding real estate for 20 or 30 years. Please do the same for equity ignoring bull and bear markets, notional profits and losses.
Many of you have been investing for last couple of years. Stay the course for at least another 15 to 20 years completely ignoring market fluctuations. You would be amazed at the fortune created for your retirement or to pass on to your children.
Must read....for those who love equity and for those who hate equity.....
Caveats:
• Invest regularly (Monthly) via SIP (Systematic Investing Plan) in large cap and mid cap mutual funds if you do not have knowledge of investing in individual stocks.
• If investing in individual stocks – Avoid stocks that are cheap or low priced i.e penny stocks. They are low priced for a reason. Avoid stocks of companies that are high in debt or heavily leveraged. Avoid stocks of companies that have dubious management. Avoid investing in stocks on basis of rumors or “sure shot” get rich schemes.
• Avoid frequent buying and selling of stocks, as brokers will recommend. That helps only the brokers to get rich via commission on trades at your cost.
• Finally, be financially literate. Remember, even ‘financial advisors’ have conflict of interest as recommendations will be made on basis of commissions paid and not what is necessarily in your interest.
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Trading quotes
Long term fundamental investor must remember this : Prices fluctuate more than values—so therein lies opportunity .
A trader's mindset : A strong opinion/bias on a market + A broad trading range + FOMO (Fear Of Missing Out) = An eroding account value.
The goal of a successful trader is to make the best trades. Money is secondary.
I have endured approx. 4,300 losing trades in my career. Learning from and surviving losses (and often the mistakes behind the losses) is part of growth as a trader. I accept losing trades as part of the journey - Peter Brandt
To win in the markets, we need to master three essential components of trading: sound psychology, a logical trading system, and an effective risk management plan.
I always take my losses quickly. That is probably the key to my success. You can always put the trade back on, but if you go flat, you see things differently. The pressure you feel when you are in a position that is not working puts you in a catatonic state.
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Life quotes
Belief is the death of intelligence. As soon as one believes a doctrine of any sort, or assumes certitude, one stops thinking about that aspect of existence.
If you want to enjoy life or find a purpose, have something to do. An idle mind will wander and take the route of least resistance to comfort.
An optimistic mind-set finds dozens of possible solutions for every problem that the pessimist regards as incurable
We all see only that which we are trained to see.
In order to eat, you have to be hungry. In order to learn, you have to be ignorant. Ignorance is a condition of learning. Pain is a condition of health. Passion is a condition of thought. Death is a condition of life.
Every fact of science was once damned. Every invention was considered impossible. Every discovery was a nervous shock to some orthodoxy. Every artistic innovation was denounced as fraud and folly. The entire web of culture and ‘progress,’ everything on earth that is man-made and not given to us by nature, is the concrete manifestation of some man’s refusal to bow to Authority. We would own no more, know no more, and be no more than the first apelike hominids if it were not for the rebellious, the recalcitrant, and the intransigent. As Oscar Wilde truly said, ‘Disobedience was man’s Original Virtue.
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Something to smile....
A skinny young man dies and goes to heaven. Reaching the Pearly Gates, he sees Saint Peter, who stops him immediately. Saint Peter then says :
"Hey you, where do you think you're going ?"
"Inside", says the guy.
"Inside?" The Saint Peter wonders. "Let me check my books for a while."
So, a couple minutes pass and he finally finds his record.
"Hmm, I see. It appears that you are an ok guy, never done anything good nor really bad. So, to let you inside heaven, you have to tell me a really nice thing you did that I might not know."
The guy thinks for a moment and says :
"Ok Saint Peter, I'll tell you a story then. I was walking down a dark alley, when all of a sudden I saw about a gang of 5-6 tough guys trying to rob an old woman. I walked all the way upto them and challenged their leader, and shouted "Come on, you guys!!! You let this woman go or you get it from me"
So they laughed, and then BLAM, I threw a punch on the head of the gang leader.
Saint Peter amazed, his mouth open, says :
"Hey! You managed to take on 5-6 tough guys all by yourself? How did we miss that, as it is not in our record? When did it happen?
The skinny man replied : "Oh well. It was about a minute back.
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Admin : Adding Vidya to the group.
Anil : Hi Vidya. Welcome to the group.
Vidya : Hi guys am new to the city.
Satish : Hi Vidya dont worry, am there...any problems I will be the solution.
Sanjay : Hi Vidya.... Tell me if you have any problem, will arrange a solution for you.
Vijay : Hi Vidya, if you need anything tell me, it will be arranged.
Sunil : Hi Vidya. Mein bhi hai, koi bhi problem ho I will manage it for you..
Vidya : Thanx guys for your support.
Ravi : Vidya what's your full name..
Vidya : Vidyadhar Patil.
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Vidya is admin now.