He is an acolyte of Warren Buffett and Charlie Munger and admits to having borrowed liberally from their value-oriented approach. He sold his start-up - which he had launched with a meagre capital of $100,000 - for $20 million in just 10 years. You must, of course, be astute enough to be able to distinguish between assets that have suffered only a temporary setback versus those that have got permanently impaired. As conditions improve, beaten down assets begin to perform and turn into money spinners. The upside - what you can make - is potentially very large. He then turns them around with competent management.īy buying an asset at a very low price, you curtail your downside risk - the maximum you can lose. Since no other entrepreneur will touch closed steel mills in places like Kazakhstan with a barge pole, Mittal is able to buy them for 10 cents to the dollar. Steel is anyway an industry whose economics are considered unattractive.
He buys steel plants in distressed geographies amid depressed economic conditions.
Lakshmi Mittal, the steel magnate, also personifies the 'dhandho' approach. From those humble beginnings, the community has amassed motel properties in the US worth over $40 billion. They pared operating costs to the bone by removing hired help and deploying family labour. The Patels bought motels at very low prices. The USA's motel industry was then in a recession. The Patels, who were driven out of Uganda by Idi Amin, landed in the US in 1972 as impoverished immigrants. The answer lies in their low-risk, high-returnapproach to business: An enduring Dhandho arbitrage spread can be seen as a moat or a durable competitive advantage.Pabrai begins his book by citing examples that illustrate the 'dhandho' way of investing. It has given me the confidence to continue to manage my own portfolio as I learn to search for businesses that are worth investing in. Pabrai has simplified thestrategy for successful investing. Book review/summary: The Dhandho Investor – Mohnish Pabrai Over time, the power of all moats tends to weaken. This is probably the book you should start with. Description A comprehensive value investing framework for the individual investor In a straightforward and accessible manner, The Mohnixh Investor lays out the powerful framework of value investing. Exploring the heart of matter – and why atoms are important Book Review. Jan 09, Federico rated it really liked it Shelves: But of course it’s exactly the right thing to do. Then it becomes enjoyable, especially for the Mohnieh reader. In a straightforward and accessible manner, The Dhandho Investor lays out the powerful framework of value investing. What I did like though were his Patel examples and certain case studies but not elaborating them, made me feel slightly disappointed again.
Mar 09, Kevin rated it it was amazing Shelves: It is subject to only a slow rate of change. For a very pre-cursory dhandno at some of the ideas that have motivated investing icons, like Mr. He does not go into the detailed analysis of the cash flows of the companies he is selecting.
#DHANDHO INVESTOR SUMMARY HOW TO#
Book Review: Mohnish Pabrai’s ‘Dhandho’ shows how to profit from bad news Risks and uncertainty are different concepts. This is related to the incredible power of compounding for more information, click here. The Dhandho method takes their successful approach toinvesting one step further and shows how you can actually maximizerewards while minimizing risk. It is a big picture view on a style of investing that seems xhandho be successful. Book Review: Mohnish Pabrai’s ‘Dhandho’ shows how to profit from bad news – The Economic Times Lakshmi Mittal, the steel magnate, also personifies the ‘dhandho’ approach. Pabrai set up an investing partnership modeled after the. Mohnish Pabrai is a 50 something Indian-American entrepreneur and investor. Pabrai talks about his firsthand encounters with Buffett and. In this episode we talk to Warren Buffett clone and renown investor, Mohnish Pabrai. A comprehensive value investing framework for the individualinvestor In a straightforward and.