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Aug 7, 2020Liked by Anand Sridharan

Dear Anand .. If I see the general Patterns in your writing you don't think banks are great business... Am I right in my understanding that you avoid banks and NBFC completely irrespective of how strong the track record and other traits are....?

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Aug 4, 2020Liked by Anand Sridharan

Fantastic essay. If one had to ask, "What one question does this essay answer?", My response would be "Why are P/E ratios meaningless?"

The minutiae that go into selecting the sector, industry, and the company include an implicit margin-of-safety component. Even if they may not provide the rationalizing brain a reason/meaning as is the case in a late stage check.

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"Except the final stage, every check is qualitative, asking the question “Safe enough?” summarises it perfectly. Came across this thought process while reading Seth Klarman's posts. A common fallacy people commit, he highlights, is using Margin of Safety as a lazy way to account for all the "known-unknowns". His 'at least 40% MOS' approach is rather for the "unknown-unknowns". Always found that really powerful.

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I love the way you construct these posts. Simple, informative and straight-from-the-heart. Keep them coming. :)

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"A final layer of safety is added by linking valuation to real financials, in an empirically-grounded manner." This sentence is not clear, can u elaborate, please?

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