Mohnish Pabrai, Indian-American investor, author, and founder and managing partner of Pabrai Investment Funds, is famous primarily for his value investing approach, which draws heavily from the philosophies of investing legends Warren Buffett and Charlie Munger. His ability to simplify complex investment principles and apply them to real-world scenarios has made him a well-regarded figure in the investing world.
Pabrai gained widespread attention for achieving extraordinary returns with Pabrai Investment Funds, a hedge fund modelled on Buffett's partnerships in the 1950s. He started the fund in 1999 and managed to outperform the S&P 500 for several years.
Another reason for his fame is his book, The Dhandho Investor, which has become a go-to guide for those interested in value investing and are looking for something simple to start with. Finally, his close alignment with Buffett's principles, including his successful bid to have a charity lunch with Buffett in 2007 for over $650,100 also added to his fame.
INVESTING PRINCIPLES
In The Dhandho Investor, Pabrai emphasises the importance of minimising risk while maximising returns, echoing the teachings of Buffett and Benjamin Graham, but with a unique twist.
His use of real-world examples, such as the business models of the Patel community in the US, makes the concepts both relatable and applicable to a wide audience.
Here are the nine key principles set in the book creating the Dhandho framework:
1. Invest In Existing Businesses
2. Invest In Simple Businesses
3. Invest In Distressed Businesses In Distressed Industries
4. Invest In Businesses With Durable Moats
5. Have Few Bets, Big Bets And Infrequent Bets
While the first five are self-explanatory, the next four require explanations.
Esta historia es de la edición October 2024 de Outlook Money.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor ? Conectar
Esta historia es de la edición October 2024 de Outlook Money.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor? Conectar
Tax Reforms: What's In Store?
The government is working on reforming the existing Income-tax Act, 1961. The impending reforms have raised many questions in the minds of taxpayers. Will the old regime and deductions be done away with? Will it really simplify your life? What's the need for these reforms? We try to answer these and other questions regarding tax reforms
5 Questions That Will Lead You To The Right Financial Planner
Choosing a financial planner is not as easy as it may seem. Besides the right credentials, you should also consider things like the kind of services you will be needing-tax advisory, estate planning-as well as the fee structure. Here are five questions that will help you choose the right planner
Health Insurance Sub-Limits
Sub-limits in health insurance are restrictions placed by the insurance company on the SP maximum amount they will pay for specific expenses that are part of the total hospital bill.
Delayed Gratification, Humility, Understanding Inflation And Risks Key To Financial Success
The journey to financial success is continuous, requiring patience, education, and disciplined decision-making.
Avoiding Common Pitfalls through Asset Allocation and Multi-Asset Investing
Just as you track the calories and nutrients for a well-balanced diet, you need a balanced portfolio that has multiple assets to balance the risks and returns.
Mutual Funds for Financial Growth
Mutual funds allow you to invest in small amounts and seize the compounding growth, and experts help tackle volatility and asset allocation, making them a potent tool to create wealth.
Multi-Asset Investing is The Financial Equivalent of A Well-Balanced Diet
Just as you track the calories and nutrients for a well-balanced diet, you need a balanced portfolio that has multiple assets to balance the risks and returns.
Theme and Triumph: How Thematic Funds Can Boost Your Bottom Line
Thematic funds target high-growth opportunities in various industries and economic sectors, allowing investors to participate in future-focused segments to generate long-term returns.
Wealth Creation Through SIP - The Slow & Steady Road to Success
For investors seeking to create long-term wealth, SIPS are a powerful tool that enables regular, disciplined investments to generate compounding returns.
Tuition Fee Varies Among Countries
I am 22 years old and have recently started working in a software company.