Poke the Box

Poke the Box: Are You a Stock or a Bond?

Let’s Start with Safal Niveshak
Here are some useful posts from Safal Niveshak archive which you might want to read again…

To index or not to index – that is the question. Here’s why we don’t invest in index funds.
When it comes to investing, Surfing is an important mental model that every investor should be thinking about for picking stocks.
Network effect is an important attribute to look for while evaluating the presence of economic moat.
We do things for people we like, because it’s a natural reciprocation to being liked. A mental model from psychology – Liking Bias.

Poke the Box: News is to Mind what Sugar is to Body

Let’s Start with Safal Niveshak
Here are some useful posts from Safal Niveshak archive which you might want to read again…

When I took Warren Buffett’s advice very seriously and it’s wasn’t about investing.
When I met the legends of investing – Part 4.
How to find great businesses, the Peter Lynch Way.
Investing and the art of due diligence.

Poke the Box: It’s a Marathon, Not a Sprint

Let’s Start with Safal Niveshak
Here are some useful posts from Safal Niveshak archive which you might want to read again…

John Templeton was the founder of the Franklin Templeton Group. His 16 rules for stock market success.
A big lesson I wish I’d learned early in my investing life.
Have you taken your investment oath? If not, here’s one to get you started. Print it, fill it, stick it in front of your work desk, read it, and practice it every day.
How to increase your savings by 9200%. A real life story.

Book Worm
Rolf Dobelli’s The Art of Thinking Clearly is one book I like going back to again and again. Dobelli has done a fine job of compiling a list of mental models especially from the field of psychology.

Winner’s curse is an interesting mental model capturing the auction phenomenon. Dobelli writes –

Poke the Box: School Yourself

Let’s Start with Safal Niveshak
Just in case you missed any of this on Safal Niveshak in the last week…

As humans, we don’t only imitate good actions, but we also have a tendency to follow wrong actions and inactions of fellow humans. The Bystander Effect.
Switching costs create moat but what creates switching costs?
A combination lock should really be called a permutation lock. Find out why.

Book Worm
The Elements of Investing is a short, straight-talk book about investing and saving. While talking about power of saving and compounding, authors, Burton Malkiel and Charles Ellis, write –

Time is indeed money, but as George Bernard Shaw once said, “Youth is wasted on the young.” If only we could all train ourselves at a young age to know what we know now. When money is left to compound for long periods, the resulting accumulations can be awe inspiring.

Benjamin Franklin provides us with an actual case. When Franklin died in 1790, he left a gift of $5,000 to each of his two favourite cities, Boston and Philadelphia. He stipulated that the money was to be invested and could be paid out at two specific dates, the first 100 years and the second 200 years after the date of the gift. After 100 years, each city was allowed to withdraw $500,000 for public works projects. After 200 years, in 1991, they received the balance—which had compounded to approximately $20 million for each city. Franklin’s example teaches all of us, in a dramatic way, the power of compounding. As Franklin himself liked to describe the benefits of compounding, “Money makes money. And the money that money makes, makes money.

Poke the Box: Dealing with Stock Market’s Moments of Terror

Let’s Start with Safal Niveshak
Revisiting the archives for some old posts on dealing with stock market turbulence…

How to survive a stock market panic…and make it work for you.
How to stop worrying and start investing.
What should investors do when stocks crash?

Book Worm
Yesterday, I was re-reading what Buffett wrote in his 1987 letter to shareholders, which I believe is one of the most important texts ever written on how to become a sensible stock market investor. As a student of value investing, you must have read what follows several times. But then, such super-texts need several readings, and then several more.

Poke the Box: Choose Must

Let’s Start with Safal Niveshak
As Mr. Market behaves like a drunkard trying to get on a horse, here’s time to revisit some old posts dealing with how to behave during a stock market turbulence like we are seeing now –

Simple thoughts on how to deal with stock market turbulence.
Stock prices may be falling, but the stock market is getting an expensive place. Intrigued? Read this post.
Your 10 big questions on the stock market crash answered.
An old, but highly relevant presentation on the return of uncertainty, and how you can deal with it.
Curse of the bull market is back to haunt investors.

Poke the Box: Don’t Set a Bad Goal

Let’s Start with Safal Niveshak
Just in case you missed any of this on Safal Niveshak in the last week…

In investing, knowledge is cumulative and the relation between effort and results is nonlinear, so focus on the process and keep practicing the art of investing.
For investors, like airline pilots, the job entails hours of boredom punctuated by moments of terror. If you can stomach the stock market turbulence you’ll end up with very satisfactory results over long term.

Book Worm
Derek Sivers is the perfect example of what one might want to call as an accidental entrepreneur.

He was a musician who simply wanted to sell his music CDs online. In 1998 the internet was still picking up and e-commerce was pretty much an unknown phenomenon. So Derek started his own website to sell his music CDs online which, to his utter surprise, grew into a multi-million dollar business. He eventually sold his business, CDBaby.com, for $22 million.

Derek’s approach to business is very unconventional but makes a lot of sense. He has compiled his business philosophy in a small book called Anything You Want. It was an absolute treat to read this book. I just couldn’t put it down and ended up finishing this 100 page book in one sitting.

Poke the Box: Practice Deliberately

Let’s Start with Safal Niveshak
Just in case you missed any of this on Safal Niveshak in the last week…

How to create your circle of competence. A video from Mastermind Value Investing Course.
Latticework Series: Another mental model from psychology – Reason Respecting Tendency.

Book Worm
A lot of professors give talks called ‘the Last Lecture’ reflecting on what matters most to them and what they’d like to pass on. in September 2007 computer science professor Randy Pausch delivered a last lecture called ‘Really Achieving Your Childhood Dreams’. Ironically, it really was his last lecture, as this youthful, energetic and cheerful man had just been diagnosed with pancreatic cancer and had only months to live.

His lecture video soon went viral on the internet and it was later adopted into a book titled The L ast Lecture. Let me share some of the things which I learned from this book.

I liked the idea of ‘head fake’ introduced by Randy in his book. He writes –

“There are two kinds of head fake. The first is literal. On a football field, a player will move his head one way so you’ll think he’s going in that direction. Then he goes the opposite way. It’s like a magician using misdirection. Coach Graham used to tell us to watch a player’s waist. “Where his belly button goes, his body goes, “ he’d say.

The second kind of head fake is the really important one – the one that teaches people things they don’t realize they’re learning until well into the process. If you’re a head fake specialist, your hidden objective is to get them to learn something you want them to learn.”

Poke the Box: Recycle Your Wealth

Let’s Start with Safal Niveshak
Just in case you missed any of this on Safal Niveshak over the last few weeks…

Safal Niveshak’s sent out the first annual letter to tribe members.
Mr. Huzaifa Husain, a value investor and Head of Indian Equities at PineBridge Investments, shares investing insights in his interview with Safal Niveshak.
Learn some new mental models in Latticework Series – Social Proof, Game Theory and Matthew Effect.
As we begin 2016, here are a few things one should aspire to do each day – Safal Niveshak’s eight rules to live by in 2016.

Book Worm
So how do you judge if a book is worth reading or not? One is, if you find a book which starts with a foreword from Warren Buffett. Don Keough’s The 10 Commandments of Business Failure is one such book.
[Read more…] about Poke the Box: Recycle Your Wealth

Poke the Box: Compounding Goodwill

Let’s Start with Safal Niveshak
Just in case you missed any of this on Safal Niveshak in the last week…

Create meaningful life for yourself, and you’ll create positive externality for others. Here’s my latest post in the Latticework series – Externalities.
Vishal’s presentation on saving and investing at Mindscape 2015.

Book Worm
Stephen King’s book On Writing had been lying in my anti-library for quite sometime. Every time I would go near my bookshelf, the book seemed to catch my attention, as if asking, “Dude, are you ever going to read me?”. When I couldn’t tolerate its stare for many weeks I finally picked it up.