As you can guess from its name, the purpose of this blog is to help investors get superior returns on their capital - better than what the same investment in Nifty or Sensex can yield.
When Warren Buffett started his investment partnership, his aim was to perform better than S&P 500 index. The goal was to deliver at least 10% points better than S&P 500. Over the years, from starting the partnership to taking over Berkshire Hathaway till now, he's outperformed S&P 500 by a huge margin - much wider than he had originally planned.
Berkshire Hathaway's stock price increased by an astonishing 1,000,000% between December 1964 and December 2015. The S&P 500, on the other hand, increased by only about 2,300% over that time. So while S&P 500 has grown at an annual rate of 6%, Berkshire has grown 20% annually.
Our aim is somewhat similar. We'll try to identify stocks which are being mispriced by the market, are undervalued and have some margin of safety. We'll also try to identify companies that are making losses or have become sick and have the potential of turning around. The second category of stocks bear higher risk compared to undervalued stocks, but they can multiply the invested capital manifolds. We hope we'll be successful in achieving this aim.
