Coffee Can Newsletter – November, 2017

For a vast majority of equity investors in India, investment becomes a complicated affair because they imbibe (or are fed) incorrect investment theories – the most common one being “To make higher returns from the stock markets, one must take higher risks”. We disagree with this theory when it comes to investing in equities, since there exist two tools that an investor can use to move from a ‘high-risk/low-return’ stock portfolio to a ‘low-risk/high-return’ stock portfolio – a) ‘patience’; and b) ‘quality of the underlying business’.