Thursday, October 25, 2007

“Look for the hated, the unloved and the distressed business.”

‘Indian market is overridden with greed’

Nobody likes sober messages when the Sensex is hurtling from one high to another, and an eager crowd cheerily goads the index on for the ascent to the next K.
But Mohnish Pabrai, Managing Partner of the US-based Pabrai Investment Funds ( http://www.pabraifunds.com/ ), is different. He sombrely observes, “Currently the Indian market is overridden with greed and there isn’t much fear. The Sensex is up over 5x in four years.”
Pabrai is the author of The Dhandho Investor (Wiley, 2007), a book that distils ‘the Dhandho capital allocation framework of the business savvy Patels from India’ and guides the intelligent individual investor in applying the framework successfully to the stock market. For starters, dhandho (pronounced dhun-dhoe), literally translated, means “endeavours that create wealth,” says Pabrai. The Hindi word dhanda, as you may know, means ‘business’.

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