The Hindu Business Line : Money Talk

Sameer Deans works with ThoughtWorks as a Business Analyst with nine years of work experience. He specialises in banking and financial services along with business process design, requirements analysis and agile development methodologies. His hobbies include writing a regular column titled “GrapeJuice”, blogging, trekking, directing plays and dabbling in the markets’. ThoughtWorks India, part of ThoughtWorks Inc., is a global IT consultancy that develops and delivers enterprise-transforming business applications.

When did you start investing: Did you start at an early age?

I started investing just after the Harshad Mehta stock scam broke in 1992 so that was at the age of 18. I started by investing in IPOs and then after a year or so moved to the secondary markets.

What asset did you acquire first — a home, stocks or was it other investments?

I acquired both stocks and bonds.

What asset allocation did you start with and how has it changed over the years?

I don’t remember exactly, but I think it was around 70 per cent in equities initially. It has certainly changed over the years and, now, is probably 15 per cent equity, 15 per cent fixed income and the rest in real estate.

Which was the first stock you picked, at what age and did you make money on it — any learning from that experience?

The first stock I picked was Venky’s India in 1993 when I was 19. I read about how it was going to be a supplier to KFC and I felt it would do well. I did make money on it and I learned the value of picking stocks based on my own research and knowledge of the economy.

What is your return expectation?

Around 15 per cent per annum from equities on an average. But if I personally pick a particular stock, I would aim for at least 100 per cent return over a period of 18-24 months. Since some stocks will not perform, the average returns over a period of time might be around 15 per cent.

Some experts believe that young investors can afford a 70-80 per cent exposure to equity. Do you share that view?

Definitely, but it would depend on the asset mix at various points of time. Assume that one acquires a house, the exposure to real estate would rise, but that does not mean that the person can also afford to invest a lot more in equities. Removing real estate from the mix, I think an exposure of 70-80 per cent to equities would be ideal for young investors, assuming they cover life and health risks as well.

Any books on investing that have impressed you?

Beating the Street by Peter Lynch. It uses simple everyday examples and illustrates the concepts of investing and stock picking.

Finally, your advice on three things that budding youngsters should / should not do when they start off with investing.

Start investing no matter how small the amount you can put aside;

Decide what your goals are and invest in appropriate areas so that you are able to redeem your investments when you actually need them;

Learn the basic concepts and then apply them yourself, don’t just follow people’s advice blindly.

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