
Veteran investor explains why most investors fail in markets
Most Indian investors are chasing money using broken tools and false ideas, says well-known investor Shankar Sharma. In a podcast called Exploring Minds, he shared some hard truths about why many people fail to build wealth, even when the stock market is booming.THE BIG PROBLEM? LACK OF SELF-DISCIPLINEAccording to Sharma, what keeps investors from growing rich is not their skills, but their inability to be honest with themselves.advertisementHe said many fail to ask tough questions and instead rely on myths. He was critical of the belief that great investors can see into the future, dismissing it as an unrealistic myth.NO ONE TALKS ABOUT WHEN TO SELL
One of the biggest gaps in investment education, Sharma said, is the lack of conversation around when to sell. Everyone focusses on buying and holding, but no one teaches how to exit at the right time.'I was lucky to make money and was luckier to actually sell. So, self-discipline is extremely important no matter what,' he said.HIS SIMPLE RULE FOR SELLINGSharma advises that if an investment performs three times better than the market average within three to five years, one should consider selling.He described this strategy as data-driven, not a matter of intuition.DON'T FALL FOR THE LONG-TERM INVESTING HYPEadvertisementAlthough long-term investing is widely praised, Sharma believes it isn't always realistic. He pointed out that Warren Buffett earned most of his wealth after 60, which may not be useful for someone trying to cover expenses in their 30s.According to him, long-term investing only works when combined with strong self-discipline—otherwise, it remains just an idea.MESSAGE FOR YOUNG INVESTORSSharma cautioned young market entrants that without a global perspective, true market understanding may take decades.He attributed a major shift in his own career to the moment he stopped thinking locally and started approaching the market with a global mindset.

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles


Mint
30 minutes ago
- Mint
Domestic private capital plays a key role in financing Indian businesses
Private capital deployment in India has risen steadily from $37 billion in 2012–2014 to $137 billion in 2022–2024, and its role in financing private enterprises has expanded over this time. The share of domestic private equity (PE) in overall PE activity in India has also grown from 9% to 11% during this period, as McKinsey data shows. What's fuelling domestic funds?: Three drivers are underpinning the development and growth of domestic funds in India: more domestic general partners (GPs or fund managers); greater fund-raising and fund sizes; and emerging interest among limited partners (LPs or investors) in India-specific portfolios. Also Read: A private capex slump: An imperfect but indicative survey points to one The number of domestic GPs with $50 million or more deployed has more than doubled from 34 to 80 between 2016–2018 and 2022–2024. Their average deal size has also risen from $98 million to $114 million, and they are addressing a more diversified set of needs among mid-market enterprises. Despite this growth, the share of domestic GPs in total PE deployment in India is a relatively modest 11% compared to 62% in Korea and 26% in Japan, leaving headroom for growth. Fund-raising by Indian domestic GPs has been picking up, going from $8.2 billion in 2016–2018 to $13.7 billion in 2022–2024. Over half (or 59%) of all capital, however, was concentrated in the top six funds in 2016–2018. By 2022–2024, the concentration rose to 64%, indicating a marked preference for managers with strong track records and successful and stable teams. Uniquely, over 90% of this capital comes from foreign investors, as domestic fund-raising remains constrained by regulation. Further, unlike other markets where domestic investors are a material source of funding for domestic GPs, India's domestic GPs compete with global GPs for the capital of foreign LPs. Also Read: Reform agenda: What India must do to get private sector investment going Domestic GPs offer attractive, India-specific growth exposure to globally diversified LP portfolios, especially as India is projected to contribute over 17% of global GDP (excluding China and the US) growth as its GDP grows from $3.5 trillion currently to $20 trillion in 2045. Value proposition of domestic GPs: They offer diversified exposure compared to global and regional peers. Top domestic funds deploy about 80% of their capital across four to six sectors, whereas global and regional managers typically concentrate 80% of deployment across two or three sectors. As the economy expands, such diversification could be a virtue for two reasons: emerging investment opportunities in traditional high-growth sectors (such as logistics, wellness services, energy transition, supplemental education and asset management) and sunrise sectors supported by a push for import substitution (such as electronics, medical devices) and the government's production-linked incentive scheme. Growth is a priority as about 75% of capital goes into expansion: Capital in India is needed to fund private enterprise research and development, product development, growth in sales and distribution and new market entries, apart from working capital, unlike more mature markets where funding goes into consolidation and ownership changes. India's degree of inorganic consolidation, with an M&A (mergers and acquisitions)-to-GDP ratio of 2-4%, is far lower than the US's 8-10%. Domestic GPs remain well positioned to fund early- to mid-stage expansion in fast-growing sectors, where ticket sizes or risk profiles often do not suit bigger regional and global funds that focus on big-ticket buyouts with stakes acquired in relatively well-capitalized businesses from existing owners. Also Read: Seven reform pathways to bridge India's urban investment gaps Address a broader spectrum of capital needs: Ready to invest anywhere between $25 million and $200 million, domestic managers can address a broader spectrum of opportunities aligned with the evolving needs of Indian businesses. Domestic GPs also view emerging public markets, private credit and real assets as important. This promotes investments in new India-specific capabilities without the burden of legacy approaches. What attracts global and domestic LPs?: Global LPs seeking to increase their allocation to India say they look to domestic GPs for access to more diversified India-specific portfolios. They prioritize internal rate of return and distributed-to-paid-in capital performance measures while treating strong governance and co-investment rights as table stakes. On the other hand, domestic LPs, including family offices and high net worth individuals, view domestic GPs as a way to get exposure to private alternatives, diversify investments beyond their core business and exercise co-investment rights in well-governed businesses that they find attractive. They tend to focus on absolute returns and have a high bar, given India's public market return record. Domestic GPs have played a meaningful role in private capital deployment in other Asian markets. They are also an increasing source of foreign direct investment and can play a key role in financing the needs of mid-market businesses as well as sunrise sectors in India. Last but not the least, they provide India-specific exposure to global private capital participants. Anmol Chaudhary and Mridul Chandgothia of McKinsey & Co. contributed to this article. The authors are, respectively, a senior partner & a partner in McKinsey's Mumbai office.


Hans India
32 minutes ago
- Hans India
Vedanta Resources eyes invest grade rating, plans to cut debt
New Delhi: London-based Vedanta Resources Ltd (VRL) is targeting an investment grade credit rating on the back of its sustained deleveraging, the proposed demerger at its Indian subsidiary, Vedanta Ltd, and its robust growth, operational efficiencies and strong financial performance. VRL is committed to reducing its total debt from the current $5 billion to $3 billion by FY27 while strengthening its critical minerals, transition metals, energy and technology portfolio. A person aware of the matter said that VRL, at a recently held investor conferences in Hong Kong and Singapore, shared that the company is looking for an immediate credit rating upgrade to BB levels by proactively refinancing and prepaying its high-interest cost $550 million private credit facility due in August 2026. In the medium term, the company plans to achieve an investment grade rating on the back of its improved debt profile, financial and operational performance. Vedanta highlighted its robust earnings, healthy free cash flows, ongoing growth projects, strengthened balance sheet, and future deleveraging plans to the investors, the source said. An investment-grade credit rating signifies a company's strong capacity to meet its financial obligations and is considered a safe investment for institutional investors. It also allows a company to borrow money at lower interest rates, attracting a broader range of investors and gaining easier access to global debt markets. At present, VRL has a credit rating of B+ by S&P, Fitch & Moody's, with S&P giving a 3-notch upgrade to the company in FY25. The investment grade rating is linked to VRL's debt reduction target (to $3 billion) by FY27, so they are looking for an investment grade in about two years from now. Sources indicate that VRL is currently working with banks to refinance and pre-pay a $550 million private credit facility that will expire in August 2026. It is likely to use a bank loan with single-digit interest rates to refinance the facility, with savings of 800-900 basis points, resulting in interest cost savings of $47 million, said the person quoted above.


Time of India
35 minutes ago
- Time of India
Tea exports from India rise by 9.92% at 254.67 million kg in CY2024
Kolkata: Tea exports from India increased by 9.92 per cent at 254.67 million kg, from January to December 2024, against 231.69 million kg in the previous calendar year. According to the latest data released by Tea Board, production in the north Indian estates during calendar 2024 stood at 154.81 million kg, as compared to 141 million kg in the preceding period from January to December 2023, registering a rise of 9.79 per cent year-on-year. In south India, production volumes from January to December 2024 stood at 99.86 million kg, as against 90.69 million kg in the previous calendar of 2023, registering a rise of 10.11 per cent year-on-year. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Thu Thiem: Unsold Furniture Liquidation 2024 (Prices May Surprise You) Unsold Furniture | Search Ads Learn More Undo Tea Board also released provisional data for the period between January and March 2025, where the all-India production during the three months stood marginally higher at 69.22 million kg compared to 67.53 million kg in the preceding similar period year-on-year. The production in north India during the three months, from January to March 2025, stood 14.38 per cent higher at 45.35 million kg over 39.65 million kilograms year-on-year. Live Events For south India, production volumes declined 14.38 per cent to 23.87 million kg from January to March 2025, compared to 27.88 million kg in the preceding period.