Great investing tips from Rakesh Jhunjhunwala

Markets are like women -- always commanding, mysterious, unpredictable and volatile," quipped 'Big Bull' Rakesh Jhunjhunwala (inset) while addressing a meet organised by Shailesh J Mehta School of Management, IIT, Bombay on August 10.

A champion broker, often termed as Warren Buffett of the Indian stock market, Jhunjhunwala had a full-to-the-brim auditorium spellbound as he traced how he made his fortune from a starting capital of Rs 5,000. His career path is stuff dreams are made of.

What earned him fame is his skill to pick under-valued stocks. Some of his renowned calls are Karur Vysya Bank, CRISIL and Bharat Electronics. There are, however, quite a few more. Talking about his company RARE (derived from the first two letters of his name and that of his wife Rekha) Enterprises, Jhunjhunwala says, "My company has only one client -- my wife -- so that I don't need to handle others' money."

One of the biggest bulls of the Indian market, Jhunjhunwala believes in trading by the hunches. "If in doubt, listen to your heart," is what he tells young investors. Extremely optimistic about India's growth story, Jhunjhunwala shared with his audience some valuable insights about the Indian economy, future of Sensex. Read on.

What paved the way to Jhunjhunwala's success?

A democratic growth process rather than an imposed one and a biological evolution, pat comes the reply.

He owes a lot to resurrection of a dormant and vigorous entrepreneurial gene of India. "The country has rediscovered its confidence."

There has been a strong improvement in India's macroeconomic indicators, combined with a robust banking system.

Improvement has also been observed in India's corporate performance, powered through productivity gains. Jhunjhunwala is convinced that on-going reforms would have a multiplier effect on India's economy.

Jhunjhunwala's investment strategies

August 14, 2007
Jhunjhunwala learnt investment strategies the hard way. And he was more than willing to share it with his audience. Here are a few gems from his book of learning

Necessary for any investor is optimism.

Be opportunistic but wait for the right moment

Study the market thoroughly. Refer to history

Maximise profits and minimise losses

Invest in a business not a company

Always have an independent opinion. Observe and read relevant information with an open mind

Be happy with your gains but learn to accept losses with a smile

Be prepared for challenges and risks

Predicting a brighter and better future for the Indian markets, Jhunjhunwala signed of by saying that the Indian markets will reach the peak by 2010.

For beginners in the market, here are a few invaluable gems from Jhunjhunwala's book:

Whatever you can do or dream you can, begin it. Boldness has genius, power and magic in it.

Do something you love

The means are as important as the end

Aspire, but never envy

Be paranoid of success -- never take it for granted. Realise success can be temporary and transient

Build a fighting spirit -- take the bad with the good

When you see a horizon, it seems so distant. When you reach that horizon, you will realize how many more horizons are within reach