Chai with Pabrai Mohnish Pabrai at Annual Morningstar India Conference - Oct. 24, 2018
Feb 10, 2023
Mohnish Pabrai, the founder of Pabrai Investments and author of The Dhandho Investor, shares powerful investment insights. He outlines his 10 Commandments of Investment Management, emphasizing the importance of focus and the perils of over-leverage. Pabrai talks about identifying undervalued stocks and the need for concentrated portfolios rather than conventional mutual funds. He also reflects on a pivotal lunch with Warren Buffett, discussing integrity and personal growth as key components in investing.
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Avoid Skimming Fees
- Avoid charging management fees that skim off the top; align fees with performance instead.
- This approach stops fund managers from becoming asset gathering machines and promotes investment focus.
Avoid Investing Teams
- Do not maintain an investing team; this leads to unnecessary costs and inefficiency.
- Focus on finding just a few outstanding stock picks instead of many.
Expect Frequent Investing Errors
- Expect to be wrong at least one-third of the time when investing due to uncertainties.
- Investing tolerates high error rates unlike other professions with higher stakes on accuracy.
