Rakesh Jhunjhunwala was a stalwart stock market investor, knowing the pros and cons of the Indian stock market like no other. Jhunjhunwala’s investment mantras are ever-valuable for us. He passed away on Sunday morning after suffering a cardiac arrest.
The billionaire business magnate had mastered the art of investing in Dalal street, becoming India’s 36th richest person.
Jhunjhunwala started out on his fiery trail of investment in 1985. Being a qualified Chartered Accountant and son of an Income Tax officer, he was ready to challenge the formidable Indian stock scene. His initial investment capital began at only Rs. 5000, it mushroomed into a whopping Rs 46,000 crore by 2018.
A week before his untimely demise, the Big Bull had been celebrating the maiden flight of Akasa Air on the Mumbai-Ahmedabad sector. Akasa CEO Vinay Dube and his team will remember him with utmost regard, as very few ace investors risk their money on a low yield high investment business like aviation.
Although some market observers cautioned against a pause in the young airline company’s ambitions, Jhunjhunwala was seldom known to make losing bets. He had advised Akasa management to be modest without compromising on passenger comfort or product quality as the airline company spread operations.
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Being extremely optimistic about India’s future market prospects, Jhunjhunwala was a rare combination of an investor and a trader. He carefully chose companies that would gain from India’s rapid transformation and growth. Here are a few of his investment mantras that may boost one’s wealth.
1. Buy when others sell, sell when others buy
“India’s Warren Buffet”, as Jhunjhunwala was called, firmly believed in standing out from the crowd. He advised market investors to use their own brain while transacting business in the stock market. According to him, going against the herd mentality will help you mint money in the unpredictable stock market.
2. Patience is key
Like any other meticulous piece of work, making the right investment also demands a fair amount of patience and time from you. Jhunjhunwala said that quickly formed decisions almost inevitably result in losses.
3. Never invest unreasonably
Jhunjhunwala advised to avoid companies in the limelight, and also stocks trading at unreasonable valuations. He said that if one falls into that trap, then all of that hard-earned money may go down the drain.
4. Respect the market
Jhunjhunwala always gave priority to the rising and falling tides of the market. He asks people to have an open mind, and buy right and sit tight-do research, buy the right stock, and sit on it until a chance comes. Also, one must know what to stake and when to take a loss.
5. No emotion
A primary part of Jhunjhunwala’s investment philosophy is never to involve emotion in business. He advised that in order to get rich, you should never get emotional about your stock ideas. He said, “Emotional investment is a sure way to make a loss in stock markets.”
6. Anticipate trends
He taught that traders should essentially go against human nature. That is, they must anticipate trends rather than being a part of them, and then benefit from them. It is also important to spot opportunities in the form of technology, marketing, brands, capital, etc.
Jhunjhunwala placed his eggs in different baskets and spread his equity portfolio across several portfolios. He said, “Passionate investors always make money in stock markets. You will never fail in any work if you do it with passion.”
Disclaimer: This article is fact-checked
Sources: Mint, Financial Express, Outlook India
Image sources: Google Images
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