Mistakes are the best teachers. One does not learn from success. It is desirable to learn vicariously from other people's failures, but it gets much more firmly seared in when they are your own.
You don't make money when you buy stocks. And you don't make money when you sell stocks. You make money by waiting.
I think a lot of people are getting more serious about how to do the most good, but there is no road map. I'm hoping I can offer an example.
The essence of a good investment manager is one who studies a given business and extrapolates the future cash flows that the business is likely to generate over the next several years. Based on the cash flow and asset assessment, they can then arrive at their expected rate of return if they bought a fraction of that business at a given price.
You know, my degrees are in computer engineering. I spent a lot of time in the tech industry. And I like to say that I don't invest in tech because I spent time in it. And I saw firsthand that the durability of technology moats is many times an oxymoron.
The single biggest advantage a value investor has is not IQ. It's patience and waiting. Waiting for the right pitch, and waiting for many years for the right pitch.
People see poverty all around them in India, but they are desensitized or immune to it. I came to the conclusion that poverty is driven by lack of education.
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