Rakesh Jhunjhunwala: Things that can be learnt from his super achievements.

Rakesh Jhunjhunwala (1960 - 2022)

He was one of the most well known and familiar figures of India’s stock market. He not only made an enormous fortune by breaking out of a conventional trade, but also inspired millions to trade and invest in stocks.

Early days: In his younger days he was asked by his father to have a professional degree before engaging himself into a professional career. Thus, after completion of his CA course he began his career in trading of stocks out of a minimal sum of 5000.

In 1985 at the onset of his investing career (when the SENSEX used to be at a mark of 200 - 250 INR) Rakesh Jhunjhunwala pictured the huge potentials of India’s domestic market. Later in his life he foresaw that the current stock market might grow at an enormous rate and might touch the 40k mark in the coming years. He had a tremendous history in market analysis, which often used to come accurate. He entrusted his beliefs in the growth potential of India’s domestic market and hypothesized that there’re no wrongs in the market, but wrongs are made by investors who are investing in it.

Thing that can be learnt from the super achievements of Rakesh Jhunjhunwala:

Self reliance: One of the most important teachings that Rakesh Jhunjhunwala had taught, one needs to be self-reliant in one’s investing career (have their own monetary capital invested) rather than being reliant on father or father in laws. (“Khud kama ke trade karo, khud kama ke invest karo. Sasur ka paisa aur baap ka paisa se mat karo”.)

Risk management and calculated risk: One should invest according to one’s own risk capacity. An investor should not invest just by being observant to other investor’s success. One should have their own research done before commencing any investments.

Fundamental analysis: Retail investors should have their fundamental analysis and research done before making or commencing any investments rather than after. One should have knowledge about the growth potentials of a stock before investments are made.

Rakesh Jhunjhunwala had a tremendous expertise on fundamental analysis of stocks. Based on his expertise and equity analysis, he wasn't hesitant in his investments in certain nano-micro-small cap stocks (i.e., Agro tech foods limited, Rallis India limited, etc).

Knowledge: Rakesh Jhunjhunwala often tutored his adherent followers about the power of knowledge in the career of investing. He himself held an in-depth knowledge in the field of trade & business, commerce, foreign & domestic economy, politics, etc.

(One could easily gain one’s own knowledge on share market by analyzing market trends and by keeping an eye on current news reports, governmental announcements on certain sectors, reading books based on investments, comparing sectoral companies, viewing certain big-bulls portfolio, following insights & financial ratios of stocks, etc.)

Mutual funds: Rakesh Jhunjhunwala often advised young inventors about the perils of retail investments and asked investors (not to get greedy and) to have their investments made through learned professionals (in case of lack of proper market understanding) by means of mutual funds.

Long term capital investment: Rakesh Jhunjhunwala was an adherent to and was hypothetical about the approach of long term capital gain. He used to believe in the theory that an investor with a long term capital growth strategy could be the ultimate victor rather than a short term.

Don’t get defeated, learn: Every investor has been off the right track, lost scores but the ultimate victors are the one who has the courage and valour to get on the right track after a defeat. Lessons are important, it not only improves but also teaches the work process, management skills and trending skills that are required to be a successful investor.

In an interview Rakesh Jhunjhunwala stated, “Patience, hard work, taking defeat with a smile…..I have been observant to a lot of losses, I had many setbacks in the past…..Never be afraid to make a mistake, only make one you can afford so you may live to make another, because if you are afraid to make a mistake you cannot take a decision in life…...Do not blame others for a mistake but blame oneself, learn from the mistake and move on”.

Ultimate advice: Rakesh Jhunjhunwala has / had always been an icon for stock investors for decades, but the ultimate and paramount advice that he gave to his followers was, ”My worst investment has been my health. I would encourage everybody to invest the most in that”.

Best websites to follow for better market insights: