Last week we lost someone whom we Indians have given many names like Big Bull, India’s Warren Buffett, etc. It’s an enormous loss for India as his optimism towards India gave confidence to others.
As we always say, it’s smarter to learn from others’ mistakes because life is too short to make them all and learn. So let’s discuss 7 essential lessons the life of Rakesh Jhunjhunwala has given us.
Estimated read time: 3 minutes and 24 seconds
Hint: Dissecting other life feels easier than ours, doesn’t it?
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Buckle up, here we go!
Focus on your health:
This is the most important lesson that his life has shown us. No matter how smart you are or how rich you are, money can’t buy health.
Rakesh Jhunjhunwala always says, “he has no regrets in life. He only wishes he had better personal habits and exercised more.”
So, focus on good mental and physical health. Have a good balance between them. Also, don’t forget to buy good health insurance and get a full body check-up every 6 months or a year.
Simplicity:
Jhunjhunwala was usually dressed in a linen shirt and trousers. His crumpled shirt made news when he met Prime Minister Narendra Modi last October in New Delhi.
We have always seen the wealthier people being very simple, like Warren Buffett, Mark Zuckerberg, Bill Gates, etc. Because branded clothes and accessories don’t define them. Their action or work does, so focus on your actions and work, not on buying the most expensive clothes.
Don’t be afraid to make mistakes:
Rakesh Jhunjhunwala says, “he has made many mistakes in his career but he would never say that he regrets any of them because it has strengthened his resolve to work harder and identify better stocks for himself.”
“The biggest cost of a mistake is not learning from it. And I’m not afraid to make a mistake. The only one which I can afford, so that I may live to make another one. Whenever you regret making a mistake, you can use it as a learning opportunity to become a better investor and a better person.”
Getting out of your comfort zone and trying new things is always best for you.
I’d rather regret the things I’ve done than regret the things I haven’t done.
Lucille Ball
Learn to be patient:
Rakesh Jhunjhunwala had immense patience with his stocks and holding on to them for years.
He’s been investing in Titan Company Ltd, for over two decades now and has made over 1,000% returns on his initial investment in the stock.
Rakesh invests in a company’s business, not its stock. He doesn’t sell shares even during stock market corrections. He has seen so many cycles in the stock market that he doesn’t get worried by short-term drops.
To be more patient, you need to improve your knowledge and gain more experience. Either learn from your mistakes or others. This is the way to build trust in yourself and be more patient.
Right or wrong doesn’t matter:
“What matters is how much money you made when you were right and how much you lost when you were wrong.”
He has always implied analysing the proper risk-reward ratio before taking any decision. When compared to the reward, if the risk is too high or not worth it, it’s better to avoid it.
Investing:
“To come to the market and get away with money is very exciting. But remember, it’s not the racecourse. The first thing I tell people is to invest after you earn. Don’t put your father-in-law’s or your father’s money in the stock market.”
Rakesh Jhunjhunwala never focused on making a 40-80% return. He was more than happy making 18-21% every year because that’s how you build wealth in the long term.
“When the stock markets are high, everybody jumps in, and when it’s low, everybody vanishes. You require a far more mature attitude.”
You can never time the market:
“Stock markets are always right. Never time the market.”
“Stock market is above individuals. The market is rational. An individual can never be smarter than the market.”
Even while spending most of his time with trading charts, a successful trader suggests not to focus on timing the market. Not only Jhunjhunwala but Warren Buffett and other successful investors say the same thing over and over.
If you want to invest in the market, invest in index funds through SIP. Need more guidance? Read simple ways to invest from our personal finance checklist series.
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