Thread by @unseenvalue

I have a 'wall-of-shame' built in an agonising manner over 25Y.

Those who know me personally or been with me here, have seen the tweets tagged as #uv_lessons which are basically my own bruises and cuts.

'Why I Failed' thread on this experience should help us all (me included).

#IPO craze of mid-90s made me experience the 80:20 rule

> 80% IPOs were 'lipstick on the pig' (bad businesses, numbers were window dressed)🚨
< 20% IPOs were good businesses at a fair price (#HDFCBank)

Sold good ones to "book profit", but kept hugging the junk ones #uv_lessons

Been tracking this biz for long, and fully exited in 2017 (purely valuation call in a volatile space); re-entered last year after 66% drop, as risk/reward was favourable; stock slipped another 15% and I added some more! (my thesis: same biz getting cheaper and I had cash).

[A]

Event: Q3FY19 con call was interesting! - the way they said, what they said - prompted me to find counter-confirmatory-evidence, and digging deeper, changed my stance with full conviction; luckily the market gods helped as prices were way above my cost.

[B]

Never be fixated with your stocks, even when they fall inside your core area of sector understanding! (you may not truly understand the beast, and maybe hallucinated!). This is even more pertinent in higher risk and heterogeneous pockets like Pharma/API. #neuland #uv_lessons

[C]

Investing is a game of probabilities. You will not be right every time and on every stock. You just need to be right above average (~70% is good enough).

Never judge right / wrong too soon (give time to market to appreciate your early finding and reward)

4 - holdings that are at least ~10Y old
7 - that's the number of stocks where I lost 90-100% of the principal (6 IPOs)
14 - that's the number of stocks sold way too soon (made just 2-3x)
16 - the age of my oldest stock holding
83 - the % of current PF in the top 12 holdings

Key takeaways:

Compounding magic works
Look down before you look up
Don't predict the future; too many variables at play
Prefer low / no debt
Share knowledge where possible
Never knowingly misguide someone
Give luck it's due credit
Upside potential is? unlimited
Sleep well 💤

Better stock picking comes from good judgement and experience, which comes from learning after bad judgements. You have to make mistakes to identify your weak links and remediate. Keep reading, practising and learning.

Don't give up!

I am over rated, period. My success rate is not 90% ! Kopran is one example since 2015. We all are students of Mr Market. Stay curious and never bet your house on a few micro caps. I therefore keep a quality coffee can and infuse it with a small cap toffee can. Luck matters too🙏🏻

As tweeted above, emotions❗️got the better of me and somehow overpowerd the long term objectives & expectations I had from #NeulandLabs.

Later, someone on Twitter shared glimses from their 2019 AR, and helped change my stance. Added post Q1 FY20 con call.

NOT a recommendation❗️

Lessons from 2007 👉

Have conviction in what you own

Conviction requires confidence

Confidence comes from deep-dive into the businesses

What's moving may not be true quality

What's not moving may well be quality soon

Sit tight with your champions

https://twitter.com/unseenvalue/status/943963024741879808?s=20

Completely missed the opportunity to participate in the ' digital consumption ' boom. That's a mistake in hindsight, period.

Alphabet
Amazon
Apple
Microsoft

Now at USD 1 trillion market caps - you think there is still a 15% compounding potential over 10 years?