The Joys of Compounding by Gautam Baid
Module Units
- 1. Introduction
- 2. Investment In Yourself
- 3. Become A Learning Machine
- 4. Obtain Worldly Wisdom
- 5. Harnessing The Power Of Passion
- 6. The Importance Of Choosing The Right Role Models
- 7. Humility Is The Gateway To Attaining Wisdom
- 8. The Virtues Of Philanthropy And Good Karma
- 9. Simplicity Is The Ultimate Sophistication
- 10. Achieving Financial Independence
- 11. Living Life According To The Inner Scorecard
- 12. Delayed Gratification
- 13. Building Earning Power
- 14. Investing Between The Lines
- 15. Decision-Making
- 16. Checklist For The Standard Causes Of Human Misjudgment
- 17. Journaling
- 18. Power Of Incentives
- 19. Avoid Physics Envy
- 20. Intelligent Investing
- 21. The Three Most Important Words In Investing
- 22. Investing Is All About Capital Cycle
- 23. Analyzing Special Situations
- 24. The Holy Grail Of Long-Term Investing
- 25. Connecting The Dots
- 26. Market Is Not Efficient All Time
- 27. The Dynamic Art Of Portfolio Management
- 28. To Finish First, You Must First Finish
- 29. Read More History And Fewer Forecasts
- 30. Updating Your Beliefs In Light of New Evidence
- 31. Opportunity Costs
- 32. Pattern Recognition
- 33. Role of Luck, Chance, Serendipity, And Randomness
- 34. Value Investor
- 35. Conclusion
Investing Is All About Capital Cycle
A stock hitting a new high has no overhead supply to contend with and has much more of an open running field. Everybody has a profit; everybody is happy. In contrast, a stock near its fifty-two-week low has a great deal of overhead supply to work through and lacks upside momentum because it is vulnerable to fresh bouts of selling by the old investors at every higher level.
Even if you do not invest in any of the breakout stocks, the positive take away from this exercise would be that your mental database will have expanded by studying the annual reports, presentations, and conference call audio recordings and transcripts of the various companies in the industry. (Conference calls are a vital component of any serious investor’s research activity list.)
For truly passionate investors, researching new companies is just delightful and never gets old. The importance of insatiable intellectual curiosity, along with a deep passion for continuous learning, cannot be overstated in the investing profession.
In investing, all knowledge is cumulative, and the insights we acquire by putting in the effort today often serendipitously help us in the future.
So work hard today to let good luck find you tomorrow.
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