”Jargon seems to be (the only place) where the right brain and the le^ brain meet”

Aswath Damodaran

Doctors/psychologists have defined how 2 sides of our brain-left & right. works differently from each other.

Left/Right Combo

The left side is characterized as Linear, logical things and reality based, while,

The Right side is characterized as big picture, intuitive, processing information on touch & feel rather than looking at letters, words or numbers.

Right side is supposed to be more creative than the left while the left is considered more analytical.

Not to say that more people are left brain or right.

In fact, brain imaging has found that most people are brain ambidextrous i.e., they use both side of their brain well.

it is easier for most people to understand a story rather than look at complex numbers and try to make sense out of them, left & right working together can be a very powerful tool.

Decision Making is complex

Narrative people think that stories matter more than the numbers while for numbers folks logic is the only way to move forward.

However, decision making is often a complex process that needs to marry not just numbers that make logical sense but also the human biases, aspirations, fear and needs.

There are 3 commong ways to convince people to take a decision:

  • Logic
  • Fear & Intimidation.
  • Influence

Overtime psychologists, marketers and ad men have found that influencing is perhaps the only way a person will not only make a decision gladly but will be even happy to justify it for long.

This is where narrative becomes bigger than the numbers.

Marketer’s Dream

Overtime as people understood the phenomenon, the process to marry the right and left started in sales and marketing.

While left side creates the numbers, the right side creates the narrative.

An honest marketer will make sure that numbers are in place instead of making a good pitch for a bad decision (for the customer), however when the number game overpowers and the need to own the latest “HOT ITEM” is high, narrative starts playing a bigger role.

It’s astonishing what a number on a deck can do when people are ready to justify their decisions.

2008-Narrative Weds Numbers

You Are Invited

If you need a marriage of different factors to create a disaster, 2008 is your prime example to go to.

In 2000, S&P 500 peaked at around 2300 or there abouts.

After all the ups and downs it was still at around 2000 in Oct 2007.

Equity investors having lost their shirt in the dotcom bubble didn’t have the guts to get back, however they were still crying for yield.

On the other hand, till 2004 interests’ rates were low leading to growth in housing market that was led by sub-prime mortgage which essentially means loans being given to people with low credit score and who would otherwise not get such a loan.

These loans were not only given at a higher rate and the terms of loan were in favour of the lender and lot of transactions were fraudulent. Everyone was trying to maximise returns.

Therefore, as it often happens and cause equity markets were not working, Wall Street created the mortgage-backed securities (MBS) that further aggravated the risk by combining these risky loans into AAA rated securities that were sold to investors as high yield products deemed safe.

Even sophisticated investors like banks had a lot of such risky assets on their balance sheet without enough capital cover.

Between 1998 to 2006, the value for such securities increased from 148 Bn USD to 1.2 Tn USD and their total shares of securitization market went from 18% to 56%.

When Fed went on its aggressive rate increase mission between 2004 to 2006 increasing rates by over 4% and home prices dropped these securities became worthless

The narrative was great here:

  • Low interest rates;
  • House as security
  • Product was hundreds of individuals loans leading to low risk
  • High Yield

Everything that will win over an investor-Narrative weds Numbers;

Unfortunately the marriage ended in suicide

Narratives winning over Numbers

If the treasury departments or Advisor of the client would have looked at the numbers and the worth of the underlying loans, they would have realised the risk.

However when the need is for higher yield and the entire market is going in one direction, the Narrative is stronger than the Numbers.

No-one wants a marriage of the 2, they are seeking to justify the decision.


A blog cannot take away the flaws in human decision making.

Logically investor should be looking to protect their interest and hence look at not just narrative but also the number.

However biases and noise in decision making restricts investors from doing so and a good marketer will always marry the 2 as if they are “Made for Each Other”.

As I say often, have a “Fun Money” allocation with which you can play some narratives even if numbers are not strong so you don’t get “FOMO” or you want to justify the narratives.

For the rest of your money, marry “narratives with numbers” genuinely.

It’s not easy and you need a strong guiding hand-

Reach out on or 9920741569 for guidance

Follow my twitter handle irreverentinvestor @manver1974 for more such shares

Crypto 101-Part II

In part I of the Crypto 101 we had discussed the basics of the blockchain tech and the various use cases of crypto.

Bitcoin being the largest and most know crypto or blockchain product there is a fallacy that blockchain use is restricted to currency and store of value.

However, that is not the case.

In Part II we will talk about the largest blockchain products by use and their various uses.


Most popular of the crypto is bitcoin.

It was created as a medium of exchange and store of value.

Followers of bitcoin consider it to be “digital gold” without the deficiencies of gold i.e., gold needs physical storage and distribution, has compliance challenges and is not easily convertible into cash.

While bitcoin can be converted into cash in seconds and also bitcoin has now been authorized as a medium of exchange by leading payment platforms from Mastercard, Visa, PayPal and Square.

Of-course its price is volatile and subject to sudden 40-50% swings leading some to look at it as a very risky proposition.

Gold doesn’t have such wild swings.

Litecoin use case is the same as bitcoin.

The jury is still not out on this so watch the space.

Smart Contracts

Ethereum gets compared to MS-Excel by the early adapters.

It is used for smart contracts making them secure to hacking.

Giants like JP Morgan, BNY Mellon, Microsoft, Accenture, banco Santander and others are already using this tech.

Ethereum is being used for contracts, issuance of new coins (Called ICO-Initial Coin Offerings), Betting, Escrow and even Digital identity Management.

Clearly if security and privacy are key concerns, Ehtereum has found its place under the sun.

However as of now the cost is high because of the complex blockchain instructions required to create the contract.

A simple contract without complicated logic can cost USD 7000 on the other hand a highly complex one can cost as high as USD 45000.

This means that users go to Smart Contracts only when the business stakes are high, and cost is not a factor.

Having said that already over 1.5 million smart contracts have been entered into using Ethereum tech.

NEO is China’s answer to Ehtereum.

Launched as Antshares, NEO also enables smart contracts.

The difference is that NEO network is built on 2 tokens- NEO and neoGAS.

While NEO is the car, neoGAS is the petrol.

NEO tokens have a limit of 100 mn tokens and these are used for block creation, network management etc., while neoGAS is used for creating security.

One of the differences is that while Ethereum has its own programming language called Solidity, NEO can be programmed using C+ and Java making it easier for programmers.

Also cost of a smart contract using NEO is 27,800 USD compared to 45,000 USD for Ethereum.

Currency Transfer

Ripple enables secure currency transfer (or even commodities like Gold or Oil) using blockchain preventing cases of fraud and making transfer safer.

Currently transfer of assets require first converting the value to USD (involves conversion fee) and then enabling transfer which can take as much as 3 days.

However, with ripple as there is no conversion fee, you can do it smoothly and within second saving time and cost.

Organizations like Bank of America, Standard Chartered Bank, Moneygram, SBI Holdings , Westpac Institutional bank, Bank of Australia have already partnered with Ripple.

The best part is that the cost of money transfer using Ripple is just about 0.00001 SRP when 1 XRP is 0.29$.

This makes it very cost effective apart from being secure.


 Large volatility in price of crypto has been a cause of concern leading to the creation of “Stablecoin”.

Stablecoins as the names suggests remaining stable in value.

How does that happen, by pegging them to another currency either a USD or another crypto.

There are 4 different kinds of stablecoins:

  1. Traditional (Off-chain)-these are the ones that are benchmarked to a fiat currency like USD so that the price remains the same as USD. The issuer can only issue as many coins as the amount of USD available with them. So if they have 10mn USD in the account, the can issue coins up to 10 mn USD with each coin being 1USD in price.

The advantage is that all the security of crypto blockchain is available while avoiding the volatility. Tether is the most knows and traded traditional stablecoin

Other examples are binancecoin, XRP etc.,

  • Crypto Collateral (on-chain)-as the name suggest the collateral here is another coin and not USD. This is on chain and fully backed by another crypto. Collateral is usually higher than underlying so that volatility can be taken care of.

DAI, Augmint, Ampleforth are some examples.

So if you want to buy 1000 USD worth DAI using Ether coins.

You might have to put 2000 USD worth of Ether to ensure enough collateral accounting for volatility in Ether price

  • Algorathmic Stablecoins-These don’t use collateral but adjusts supply to keep price stable. So if price falls, they reduce supply and if price increases, the increase supply.

Ampleforth, based, Empty Set Dollar, Dynamic set dollar are some examples.

  • Commodity back Stablecoins-its clear from the name that these coins are backed by commodities. Most common commodity being used is Gold.

Tethergold and Paxosgold being the 2 most widely used commodity backed Stablecoins.

Primarily this is an easier way to hold the underlying without need for physical possession. For example holders of Paxos Gold (PAXG) stablecoins can sell them for cash or take possession of the underlying gold.

However, because London Good Delivery gold bars range from 370-to-430 per ounce, and each token represents 1 ounce, users must hold a minimum of 430 PAXG to execute token redemption. Once redeemed, token holders can take possession of their gold at vaults throughout the UK.

So, there are multiple use case and options of tokens available as per the use case.

The subject is deep and requires guidance for which I can be reached on or +919920741569

Part III will be out next week unless you want it earlier in which case follow my twitter handle irreverentinvestor@manver1974

The Thrill & Pain of Success

G-force (gravity force) is the acceleration of an object compared to earth’s gravity.

When someone is merely standing, it is a 1-G environment where the earth’s gravity is pushing against the person.

Imagine a plane making a rapid 90-degree turn, it can create acceleration of up to 6 times earth’s gravity of 6-G.

In a 1-G situation the heart can easily generate blood to enable circulation in organs above the chest. However, if there is a sudden acceleration blood flows down to the legs making it difficult for heart to ensure circulation above chest which can result into a G-lock that can even kill a person.

The brain cells only have enough blood to keep it going for 4-seconds.

In untrained adults a 3G force is enough to destabilize the body.

A key part of pilot training hence is to teach breathing and muscle sensing techniques to keep the body going under extreme G-force.

Formulae 1 Drivers subject themselves to enormous forces every time they get behind the wheel, with straight-line accelerations and deceleration among the most savage of any form of motorsport; From a standing start the cars can pull around 2G and braking at the end of straights can results in as much as 6G at times. Around 1G of this comes purely from lifting off the throttle, and drivers have to apply around 160kg of force to the brake pedal to achieve the balance.

At the Tuscon grand prix in 2020, Lewis Hamilton posted 4.9G, 5.6G and 5.2G through turns 6.7 and 8 in practice.

Drivers need to strengthen their neck core and legs to meeting this challenge.

Not only that they need to be light to keep the weights of the car down and maximize speed of the car. To maintain this drivers, go for stringent diet taking a toll on their bodies and making them sick.

Hamilton has admitted losing 4kg in a single race.

Necks, Arms, Legs and Core need be in best shape for the formulae 1 driver and is a key factor in their fitness regime.

Drivers use weighted helmets to perform reps and build muscle mass. Capable of shifting 40kgs with their necks alone F1 drivers are supposed to have the strongest neks in the sport.

Why am I telling you all this?

Formulae 1 race appeals across age groups and genders for the fast thrills that it manages to create.

It’s great to see the drivers slugging it out for 90 mins and your favorite driver coming out a winner.

It’s not just formulae 1 for every sport or profession those who excel work very hard before they come out to deliver.

Outcome is Dependent on Preparation

They say XYZ became an overnight success in 10 years.

Those 10 years were the years of devotion to the craft which created the winner.

You want to achieve success you to prepare yourself and create a process which you follow with discipline to compete against the best.

Outcome is Visible

What we see is the outcome, what we miss is the process.

When the process is done well, outcome seems effortless.

That’s the beauty of a great process.

You can apply this to your profession, your daily routine or anything else in general.

There is no easy way out.

Even if you find one overtime you will realize it’s a “Zero Sum Game”.

What to Do?

  • If you don’t know, get a coach (all professional athletes have a coach), mentor, guide, advisor
  • Get to know your self-strengths, weaknesses, goals etc.,
  • Establish the roadmap
  • Take the pain to understand what you are getting into and its pros and cons
  • Develop your competencies or hire them

Remember, 90% of success will be off the field.

Finally stay the course.

For guidance contact or +919920741569

Follow my twitter handle irreverentinvestor@manver1974 for more such shares

What We Don’t Remember

20th and 21st Century combined has seen the kind of progress that a human being in the 19th century could not have even imagined.

However, life was not always easy for the generations that experienced 19th and early part of 20th century.

Let me illustrate with some examples:


Just a 50-year period between 1850-1899 saw 24 major famines in India leading to millions of people losing their lives.

Last major famine in India happened in 1944.

Food Scarcity

Droughts, dependence on monsoon, small land holdings, low yields and lack of finances meant India experience continuous food scarcity till the green revolution was initiated.

Proportion of population reporting hunger reduced from 16% in 1983 to 1.9% in 2006.


Train and waterways takings weeks/months of travel were the most used means of mobility.

United States had like 10 miles of motorable road in 1900.

There was no air travel.

Personal vehicles for mobility were in nascent stage with the first car having been manufactured in 1886.


Theatre troupes, ventriloquists, hypnotists, poets, comedians, choirs and orchestras were the main source of entertaining in 1900s.

First movie ever produced was in 1881 and it was a 2.11 second film reel.


Epidemics were a part of life for the 19th and even a large part of 20th century.

In fact, in book Guns, Germs and Steel, author Jared Diamond details, how germs carried by those looking for new territories led to huge number of deaths in the Asian world from North America, Africa to Australia.

Polio was eradicated in 2000 while for malaria the date is set for 2050.

However modern medicine has made so much progress that disease like malaria, TB, Polio. HIV and even common cold that were once life threatening do not capture public imagination anymore.

Short-Term Memory

The oldest perhaps bad habit of human beings is perhaps forgetting what brought us where we are.

The whole progress is taken for granted to the extent that they are not in the vicinity of our thoughts leave alone doing something to prepare for the shocks.

This memory failure can be seen as the genesis of how “Fat Tail risks” have the ability to jolt us into a shock.

When you read the above, it all seems familiar but is it upfront and center for you when you look at your life/business/career etc.,

Covid was that jolt.

Everything that we take for granted has been brought into questioning by this epidemic that has impacted the whole world causing millions to fall sick and so many lives being lost.

If history teaches us any one thing it is that more things change the more, they remain same.

Humans might be the most dominant race on earth, but it has not conquered the world.

Nature is more powerful.

We have always been successful in meeting the challenges of nature.

However, CORONA has taught us that if we are not pro-active what happened centuries back can happen again.

We can save ourselves from nuclear holocaust because activation is in our hands, but can we save ourselves from the attack of the nature or how nature will react to our treatment of it.

Ultimately it all boils down to our preparedness for fat tails and not just our reactions.

Because if the focus is on reactions damage will happen before we control.

And this applies as much to our personel lives as to global problems.

Not every “Risk” can be anticipated and that’s why you try to remove fragilities from your system as far as possible.

During the Middle Ages when war was “par for the course”, kings will build trenches around their forts/cities and generally try to make it difficult for the attacker to reach inside the fort/city.

The idea is to give yourself a chance to fight for another day.

Whether it is an epidemic, your career or your investments, stop anticipating all the risks.

Focus on creating a strategy that has a natural immunity and can give you another chance to fight it out.

For guidance contact or +919920741569

Follow my twitter handle irreverentinvestor@manver1974

Crypto 101-Part I

Most of us have by now heard of bitcoin, crypto currency, blockchain NFT etc.,

What’s most popular in all of these is of-course bitcoin due to the massive increase in the price over last 10-12 months.

I have titled the blog Crypto using it as a generic term as Crypto is more that just currency because of the tech behind it.

Even in 2017 bitcoin frenzy had caught the attention of all investors, however it died down so as the price crashed.

For next few weeks, I shall publish a blog to share some details on Crypto and its tech.

What is a Blockchain?

Let’s start from the basics.

The technology behind crypto which is called the blockchain.

Imagine blockchain like a bank passbook to keep track of your debits and credits.

Now imaging this passbook holds details of millions of people and the information is held on thousands of computers.

Each computer will need to verify the transaction and once it is verified, it is like recording it on the physical passbook in permanent ink.

The register records transactions for a set period of time which can be as less as 10 mins and once the register is filled, it is shut and assigned a code (alphanumeric) to identify it.

Once the register is shut a new one is started which is attached to the first one and that is how you get a chain of registers called a blockchain.

The fact that these registers are residing on thousands of computers, you will need to work backwards and unattach them before you can reach the original transaction and change it. This obviously cannot be done without being identified and that is what makes the technology unhackable.

What can I use Blockchain for?

The blockchain tech was created by the creator of bitcoin (pseudonym Satoshi Nakamoto) who had set out to put up a secure, faster decentralized financial system, available to all with or without access to formal financial system.

The backbone of crypto is blockchain that I described above.

Crypto is designed to be viewed as a medium of exchange or what we know as a “Currency”.

 Since then, of-course the technology behind crypto (blockchain) has become stronger and several use cases have been designed.

Here is a look at some of them:


According to the creators, today’s banking system is discriminatory as it puts all power in the hands of the banks and regulators where the small guy is on the mercy of the system and has no influence.

So, a system was imagined that would have no central authority and would work person-to-person and would enable use of funds without requirement of any entity.

Immediate and urgent settlement of a transaction instead of waiting for a payment system to respond with requirements of thousands of compliances.

Store of Value

Crypto has gone from strength to strength and is now considered akin to Gold as a store of value.

The argument is that crypto is not impacted by inflations and is a better store of value increasing in value over time.

All currencies across the world have lost value over time given the impact of inflation.

For example, with bitcoin it is argued that its supply mechanism will restrict inflation given that the supply is restricted to only 21 Mn coins.

Of-course price volatility has led many to question this premise.

However, this is still an evolving space.

Lending & Borrowing

Credit ratings, bank processes etc., have made it tough for people to borrow through the formal mechanism.

What if you could get a loan digitally, without even having to fill a single form or sign a contract? That’d be amazing, right? 

Decentralized finance applications seek to remove the “middleman” from the lending and borrowing process.

They allow individuals to lend and borrow funds almost instantly using cryptocurrencies. In addition, as cryptocurrencies are borderless currencies, you can lend or borrow from these platforms irrespective of where you live.

Asset tokenization.

Most of you might have of-late come across the term NFT (non fungible tokens).

Blockchain tech allows anything from art, real estate to copyrights to be created into a token making it hard to hack and take ownership of.

Millions of dollars have been spent by people to acquire these digital assets and more are being created.

In-fact Nike has just registered patent for a blockchain shoe called cryptokicks.


Cryptocurrencies, in the form of non-fungible tokens (NFTs), are already disrupting the gaming industry.

In the gaming world, NFTs are crypto tokens that represent a unique digital asset inside a game.

As each NFT represents something unique, they have different values and are not interchangeable. This gives every user a completely authentic in-game item, the likes of which is owned by no one but them.

Digital cats called Crypto Kitties are the most famous example of blockchain-based NFTs.


The centralized cloud storage platforms have many major shortcomings from high fees to server outages.

This has hence created space for decentralized storage created through the use of blockchain.

In such a system, anyone can rent out their free storage space. 

If you had 250 GB free on your disk, you could rent it on a decentralized storage platform such as Filecoin and earn a passive income from it.

People who opt to buy your storage space would pay you in the storage platform’s native cryptocurrency.

We shall discuss more about this subject in the part 2 of the crypto blog next week unless you want me to publish one earlier in which you can follow my twitter handle irreverentinvestor@manver1974 and put a request.

Contact me on or +919920741569 for guidance.

Should you follow “Influencer Investing”

Here is a story on how some online brokerages are using social media influencers.

One of the good things about investing is there is no right or wrong.

What works for you is right for you.

So, checking out some of these influencers you can see the audience for which it might work.

What kind of advice are you looking for is also very critical aspect to consider.

How does it work?

Academics will teach you that there are 3 methods to change behavior:

  1. Dictate change-works for a while but doesn’t make every lasting change
  2. Argue change-you might win the argument but not the change
  3. Influence change –
    • There are individuals around everyone who are either respected, envied or competed against.
    • These are your influencers by design or not.

Is it Healthy?

As a marketing technique it is great to create an influencer campaign.

It might even convert into business.

Remember “Influencers” are there for a reason.

They give you comfort and sense of relatability.

Like with everything understanding how you use an influencer and who is the right influence can help.

When you deal with someone who doesn’t have the background to understand technicalities of financial investing, the whole idea is to simplify the campaign.

“Simple” and “Simplistic” are separated by a fine line.

It is always easy to take one part of the equation and amplify it.

However, financials decisions are about setting the context right.

Now that is time consuming, and no IGTV/Reel’s content can do justice.

 The easiest route then is to dish out simplistic advice and product pushing.

There is a PR element to every company that helps it be seen as an ethical/interested in customer well-being/communities etc., kind of company, and then

There is real business to be done.

I would love to have consultative sales process, unfortunately it is too time consuming and expensive so go and do the easy thing to push products.

Influencers come handy here.

Is that the kind of Influencer you want to follow?

Easy Way Out

Individual investors as we have discussed earlier have a complex relationship with investing.

It is also driven by the same factors that create influencers.

  • X person invested in so and so, which did well so I should also do the same
  • X person has made so much money is Y investment, I am more intelligent than s/he, I will also do that same

Remember this:

As an investor one is looking for easier answers and simpler ways to take a decision, however investing is serious business.

You will get the easy answers and simple ways after putting in the effort.

It’s like once you learn driving it seems simpler but till you do, you are scared to touch the wheels.

Now serious investing takes efforts at understanding

  • Yourself
  • Your financial needs
  • Your ability to take risk
  • Your time frame
  • Take the effort to Understand what you are investing in and what are the risks associated (and don’t’ say I will not invest in what I don’t understand)

Tough ask, so what’s the easiest way out.

Be a Follower.

Should you be a Follower

Being a follower in social, professional, religious or politics is driven by beliefs or needs.

However, in investing the leader and follower might be playing completely different ballgame.

The leader’s knowledge, ability to understand risk, margin of safety, timing, information network, liquidity and timing of exit are neither known to you in advance nor on your horizon.

By the time you realize something has been done by the leader, the “ship might have already sailed”.

However if you have answered all the questions listed above, you might be able to differentiate between the applicability of what an influencer is saying for yourself and that’s really where you wish to reach.

There is no shortcut

Yes, you could track and listen to the influencer and their moves but remember “investing is not one size fits all”.

You need a guide who can put what you need, you listen into the context of your circumstances.

For ideas/guidance contact on +919920741569

Follow my twitter handle irreverentinvestor @manver1974


Regret theory talks about how people anticipate regret when they make the wrong choice and how that plays on their mind when taking a decision.

At times this fear can paralyze action and make people take irrational decisions.

Legendary investor Perter Lynch often cited CML Group as a regret.

He had experienced their products personally, he knew sales were rising.

He had 2 trusted analyst tell him that the company is doing well and should be considered for investment.

However he had a nagging doubt that prevented him from investing.

#Universal Experience

When Warren Buffett first bought a stake in Berkshire Hathway, it was a failing textile company. He saw an opportunity in closing mills and bought a large stake.

A few years later the manager of the company offered to buy back the shares from Buffett, however the offer was too low which got him so angry that he fired the manager and ended up becoming majority owner of a failing business.

Buffett has estimated his losses from this purchase to be to the tune of 200 Bn USD.

#FOMO & FOBI are Like a Pandemic

In March, 2020 most investors had FOBI (Fear of Being In) and today they have FOMO.

Those who sold then found it very difficult to get in which is almost always the case.

In 2020 we saw what’s called a classic “sector rotation”, first came FMCG, then Pharma and then Tech and then something else.

It was exhausting for investors.

Just as you thought you got it right, something else started working and where you invested lost momentum.

#Are you up for the ride?

Our experiences make us who we are.

You don’t suddenly grow up into a confident smart adult.

You go through series of experiences, good, bad and ugly and a product of that is what makes you what you turn out over “The Long Term”.

Investors have a short-term memory.

A good year makes everyone an expert;

A volatile year takes wind out of the sails.

Universally every investor says, “I am Long-term investor”, however when what they hold is not working, they either turn into “momentum chasers” or get massive regret.

This can have severe confidence crisis and leads to FOMO/FOBI.

It is a roller-coaster indeed.

#Core Issue

Lack of understanding.

I don’t tire saying this but investors need to know what they are getting into and why.

The lack of understanding (which is understandable when that’s not your area of expertise) leads to decisions based on tips, half-baked ideas and finally regret.

#What should you do?

Every day we try to incorporate work, family time, relaxation, work-out, entertainment.

Now different people have different idea on how each of the above will work, but it is taken care of nevertheless.

So have a plan that incorporates each of these needs/factors/emotions that you need taken care of in your allocations.

Always remember discipline of investing rather than chasing returns will have more stable outcomes.

Are their ways to incorporate each of the above in your portfolio.

Yes there is.

There is no short-cut to success and don’t even try to look for one.

For ideas and guidance contact on or +919920741569.

Follow my twitter handle- irreverentinvestor @manver1974

Relationship With Money

People have complex relationship with money.

The push and pull of decisions that should be rational and choices that are emotional makes life difficult all the time.

Depending upon how one is positioned emotions as wide ranging as fear, guilt, shame and envy can impact the rational of ones’ decision making.

Fear of not having enough, guilt on over-spending and even not being able to enjoy; shame of not doing the right thing and envy because of comparisons with others can make money choices very complicated.

Stage of life and priorities can also complicate the equation.

While the rational side of the equation tells us to save more, postpone consumptions, the reality is that Over 60% of Indians are spending 59% of their earnings on living expenses while over 51% admit to not even knowing how much money they would need in retirement.

Let’s examine this in detail.

There are 3 stages of money that an individual can experience:


In a low capita income country, majority experience is scarcity of money.

Limited resources and limitless wants.

Children moving into adulthood and having experience scarcity tend to be like pressure cookers, they have been holding themselves back for too long.

Who doesn’t aspire for a nice phone, car, home etc.,

Frustration is a big part of this experience.

Daniel Kahneman in his new book “Noise” talks about how hunger impacts decision making amongst judges.

Hunger is the noise, and any kind of hunger suppressed for too long beyond the lunch time is bound to have negative consequences for human faculties to make a right/rational decision about money.


With income or increase in income comes freedom.

However, if all that you experience through life is scarcity, what do you think will happen first, “savings” or “consumption”.

This phase has the most complex manifestation of emotions for an individual:

  • First comes heavy duty consumption, lot of money in the beginning of the month. No money around the middle till the end of the month

There are over 20 providers of loan against salary in India

This on top of “buy now pay later” plans on offer

You can imagine the vicious cycle

  • As people grow older, comes the circle of shame combined with guilt
    • I don’t have enough money
    • I spend too much
    • I don’t have a plan
    • I don’t have knowledge
    • I have not saved enough
  • Then comes the random advisories
    • Postpone consumption
    • Don’t’ buy coffee, make it
    • Don’t eat out
    • Cut-back

The vicious cycle can be a crazy ride


This is aspirational. Reaching here is a dream most find unattainable and for a reason.

This is where you want to reach but don’t know how.

You don’t reach here by cutting small expenses, take train instead of cab, make coffee instead of buying it but by discipline around your larger expenses.

It is the large impulsive/emotional spend that just takes the sail off your boat.

You can cut coffee for a whole year, but it will no match for a large unwanted expense.

Reaching abundance is hard.

It needs a coach, a guide, a specialist and whole lot of discipline around your relationship with money.

The idea is not to postpone joy out of your life for some uncertain day in future when you might/might-not even be alive but to prioritize your needs and wants.

When people diet, the dietician allows a cheat day, your consumption also needs a cheat day.

However, whenever the spend is going to be bigger than what you can afford, sleep over it and see if you still need it.

Sachin Tendulkar once said that when chasing a target he doesn’t keep it in from of him but at back of mind.

Keeping it in front puts too much pressure and restricts natural game.

If you think like that about your relationship with money, the ride might seem a bit more smoother if not easier.

Follow my twitter handle irreverentinvestor @manver1974

What Really Matters

2.75 crore cases, over 3 lakh deaths, I assume over 10 crore households urban/rural, poor/rich without any religious bias got impacted by Covid.

Last almost 15 months have been a watershed moment for almost everyone across the globe.

It changed how people looked at the world.

It was like one of those fantasy sci-fi coming true.

A nightmare for those directly impacted  and a source of fear for everyone else.

As lakhs struggled for help and lost their loved ones, a sense of gloom descended across the country.

On the flip side the pandemic was also an opportunity for people to assess what’s really important to them.

When times are good most of what really matters is our work (for most this is their only identity);

material well-being (acquiring more and more and making this an attachment of status)

The above 2 are used to create an image for the outside world while it doesn’t matters what’s happening inside.

A lot of literature and self-help books that people often read but seldom imbibe talk about

  • Sense of Purpose,
  • Control on our time,
  • Gift of health, and
  • Strength of our relationships.

Most of these are like religion/God or Spirituality that one us reminded of only during the crisis time.

3 things I believe have been opportunities stemming from the pandemic(The idea is not to generalise but present, it might not be equally applicable to all):

#Is there a deeper meaning in your work?

Over last more than 22 years of working life, one has met scores of people for whom a job is just that, a job. It has no meaning for them accept for it being a transaction exercise.

Covid actually made a lot of people realise how even a cog in the wheel has an important role to play.

Albert Camus’s classic novel The Plague. is about an epidemic, where the main character was a doctor,” he explains. “And he says the way to get through something like this is to be a decent person. Somebody asks him, ‘What makes a decent person?’ He says, ‘I don’t know but, for me, it’s just doing my job the best way I can.’

This is classic, when leaders wonder about lack of engagement in their staff, they don’t realise that most of them don’t have a sense of purpose.

The pandemic has been an opportunity to reassess the career and reflect on its purpose on your larger mental well-being.

Number of PR articles appear in Sunday papers on how organizations are addressing mental well-being.

Easy solution has always been mechanical(PR route), take the difficult road for once.

#Family Bond Re-set

A recent survey by the Telangana Information Technology Association (TITA) found out that Work From Home (WFH) is bringing the families together. The remote working is strengthening the bond between husband and wife. The survey reveals that 89% of techies reported enhanced relationship with families and spouses.

Surveys of-course need to be taken with a pinch of salt as the book “Everybody lies” by Seth Stephen proves.

We know people tend to give the right answer in the survey rather than the correct one.

Here are some trends from Google worth looking at though:


The good news is that very few searches for suicide in India, the bad news, in just 1 week between June 14-20, 2020, the search for suicide spikes to 100

Divorce searches spiked in 20-21 so did stress.

So while the survey tells us one things, the reality could be different.

The opportunity of more facetime with family seems to have resulted into different outcomes for families, however it can still be taken as an opportunity to build better bonds and maybe achieve the outcome of the Telangana survey.

#Health is Wealth

So many of us take our health for granted until we have a reason not to.

We neglect exercise and then wonder why our bodies complain when we need to climb a flight of stairs. We neglect our diet and then wonder when all this extra weight crept up on us. We neglect our mental health and then wonder why we’re always stressed.

We can be kinder on ourselves. We can add regular movement to our lives. Walking, the gym, bodyweight exercises, yoga—it all counts and can all be mixed up. Our bodies are made to move, not sit humped over laptops or in front of TVs all day. Embrace the ability to move.

While the pandemic has scared the hell out of a lot of people, it has also brought health at the forefront of these discussions.

The scars of pandemic will not go away easily

However as the things settled down, online fitness classes have zoomed.

Some of the fitness apps growing 10-times in size over last 12 months.

Retail health insurance grew 28% in FY-21;

Searches related to Health on Google spiked 30%.

I hope this remains one trend that people will not give up on easily.

Human being through history have been known for short-term memory and moving on.

While moving on from a crisis is a good things, one hopes some of these trends have had a deeper impact on human psyche and the positives will stay longer and be part of daily life.

Follow my twitter handle on irreverentinvestor@manver1974

Thundering Herd & The SMALL GUY

Mid 1900’s was a time when individual investors were the most prominent investors on wall street rather than institutions like Mutual Funds, insurance and pension funds.

Most of the large brokerages would use small time brokers to execute their orders, however it was Merrill Lynch that launched its network of financial advisors famously known as the “Thundering herd” who would execute trades directly for the investors.

However, over time as mutual funds and pension funds came into prominent, the institutional investors became the real thundering herds as they were the ones who were doing all the buying and selling.

In 1993, this is what Peter Lynch (famed fidelity Fund Manager) wrote about it:

“A sizeable faction of this Thundering Herd could even be called the Blundering Herd. I can say that with confidence, having ridden with the Blundering Herd on more occasions than I care to admit.”

Lynch goes on to say that the fact that professionals handle bulk on the money gives the individual investor an inferiority complex. However actually it improves their chance to make money if they can act contrarian to the Thundering herd.

2020 saw the return of the small guy in a big way.

In the United States it was driven by the phenomenon of Redditt and Robinhood investors bringing the hedge funds on their knees with “GameStop” and “dogecoin” investing leading the pack.

The same phenomenon that was driving retail investing in the US was seen in large numbers in India in 2020.

Sitting at home, nothing much to do, over 1 crore new investors opened broking accounts and started transacting.

Between March-20 to March 21, retail ownership of equities went up by 5.25% from 9.5% to 10%. On its own it might not seem a large increase, however considering that India’s market cap went up by 1Tn USd in 2020-21, this additional 5.25% represents over 50 Bn USD or 3.5 Lakh Crores.

Retail investors especially the new ones had a great time last year thanks to the relentless rally and earnings surprises;

See here:

Almost the entire retail participation went up in mid and small cap where they experienced 4 quarters of positive earnings surprises.

Most of retail investors got the confidence that they can now manage money better than the professionals.

Let’s go back to Peter Lynch now.

He said individuals can benefit by the herd like movement of professionals.

Since he said this most of Fund Managers have also learnt their lessons.

However, in this rally what we saw was not un-herd like behavior from individuals but actual herd like behavior.

If gamestop and dogecoin are examples in the US, PSU names ae an example in India.

Most of the business channels have an advisory section where investors are asking advisors about what to do with their stock holding.

The crucial point that comes out of these discussions is that most investors didn’t have a good understanding of reason behind what they were buying.

40% of Nifty 50 stocks under-performed the benchmark over FY-21;

Of these 40%, 30% were PSU stocks.

Investors need to pay attention to some crucial points:

  • Getting lucky in stock market is not an everyday phenomenon and individual investors need to realize this.
  • If you would not buy a house, a car or a refrigerator without due-diligence and research, should you be investing your money without understanding what you are buying
  • While last year went well, have you got the tools to assess how’s your portfolio positioned for the next year
  • What can be earnings impact on your portfolio holdings of the 2nd covid wave
  • What are the long-term prospects for the businesses that you are holding?
  • After all of this what are your returns versus the benchmark

Even a professional Fund manager cannot claim complete understanding of every business that they own, for example there are hundreds of different chemicals being manufactured, can anybody claim complete understanding.

It is said that if you didn’t know how you made money, you wouldn’t understand why you are losing it.

There are no right or wrong answers in investing, however understanding what you are getting into is crucial to understand the risk and if you are up for it.

Follow my Twitter handle @manver1974