The Hindu Business Line : Cultivate patience, diligence and discipline

Investment is all about passion and discipline. It is thus vital to take the plunge to the fullest extent possible, factoring in the inclination and stamina of the individual.

MR KUNJ BANSAL, CHIEF INVESTMENT OFFICER, RELIGARE SECURITIES

Are investors born or can they be `made' too? Are some people just not right for getting their feet wet in the world of investments? Investors are always `made', says Mr Kunj Bansal, Chief Investment Officer, Religare Securities Limited (www.religare.in). "Take the raw material in the form of a human being hungry for wealth creation, add the processing in terms of experience and honing of skills, get the final product in terms of a `wise investor' and see the results!" This is how investors are made, Mr Bansal explains to Business Line.

"Am yet to come across a born investor... I would love to interact with one in case there are known ones," he says, quite earnestly. In Religare, Mr Bansal heads the Portfolio Management Services division, which manages customer's investment portfolios. An engineer from Jodhpur University and a management graduate from Narsee Monjee Institute of Management studies, he has worked with the Reliance Group and the Unit Trust of India. Mr Bansal's experience has been in the areas of security analysis, portfolio management and offshore funds.

Excerpts from an interview:

When is an investor old enough to invest in the stock market, and take decisions on buys and sells? How savvy are the young Indians in this, compared to their counterparts in other countries?

Frankly, no investor is ever old enough to invest in the stock market. She can be considered to have `qualified' as having come of age when, after burning her hands, feet etc. (read lost substantial amount of her money) a few times over while attempting to make a quick and super — normal profit on `tips' and `inside information' alone, acquires a definite style of investment — consistency in the kind of stocks she opts for, consistency in the rejection of the ideas which don't fit into `her understanding of investment prospects', consistency in approach to gleaning ideas from the secondary sources and, above all, adherence to her `developed style' of investment most of the times! And mind you, Indians are most savvy in this compared to their counterparts anywhere in the world.

What are the pitfalls that the young investor should avoid?

To my mind, young investors should avoid pitfalls based on `tips' or `inside information' or on `fashion'.

On the qualities most necessary for investing.

Most required qualities for proper investing are patience, diligence and discipline.

Would it be a good idea to manage the portfolios of relatives and friends?

No. Every investor has different investment objectives, time horizon, risk-return profile and likings. One should never take the risk of trying to do these things for relatives/friends. Instead, they should be best guided to professional money managers.

Is there any benchmark of how much failure can be digested?

Failure, without doubt is the other part of the `coin'. Therefore, it is only to be expected and welcome for the benefits it brings — wisdom, learning, etc. as long as it is interrupted by success at regular intervals if not more.

How about plunging into investing full time? How many hours do you suggest students can devote to investment?

Investment is all about passion and discipline. Therefore, it is vital to take the plunge to the fullest extent possible, factoring in the inclination and stamina of the individual.

Any courses that can help be a better investor.

Basic exposure to concepts of financial accounting and strategy helps to grasp the essentials of stock evaluation. Thereafter, it is learning from experience and the right `teachers' which matters.

Should parents encourage the young to invest?

Yes. Parents should definitely inculcate the concept of investment in their children from an early age. It helps develop a sense of responsibility and respect, as far as wealth is concerned.

Is diversification of investment portfolio necessary even at the start?

The concept of diversification is quite broad based. Thus, I would rather leave it to the incumbent set her own rules/canons for defining the parameters of comfort for devising the portfolio.

Any courses that can help be a better investor.

Basic exposure to concepts of financial accounting and strategy helps to grasp the essentials of stock evaluation. Thereafter, it is learning from experience and the right `teachers' which matter.

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