3/31/2024 0 Comments Dhandho investorBuy simple businesses in industries with a slow rate of change.Such businesses are usually less risky than an unproven start-up. Buy existing businesses with a proven business model and history of operations.With this in mind, Pabrai outlines several core principles to Dhandho-oriented investing: Buy existing, simple and distressed businesses He describes compounding as a snowball effect that can lead to amazing results over time. To Pabrai, Dhandho is about the maximisation of rewards and the minimisation of risks. The Dhandho frameworkĭhandho is a Gujarati word that means “endeavours that create wealth”. In this post, I will summarise the key lessons that I took from Pabrai on value investing and capital allocation. For the curious, there’s much to learn about his philosophy and temperament in his book, The Dhandho Investor, which I found an insightful and accessible resource. One striking feature of his methods, amongst many, is his willingness to hold a concentrated investment portfolio, even by value investor standards. Mohnish Pabrai, managing partner of Pabrai Investment Funds, is a more prominent value investor.
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