Bats and balls — but not baseball — win over Texas kids
Shah Rukh Khan is a smart businessman and given that he’s investing serious money in North American cricket, it is worth paying more attention to the cricket scene in USA. This interesting piece in the Washington Post explains how the growing size and affluence of the Indian community in Texas has made that state a […]
What’s the best way to help extremely poor people? After 20 years, the evidence is in
Whilst conventional wisdom has it that microfinance helps the poor, one of the world’s leading practitioners of this form of finance, Shameran Abed, the director of BRAC in Bangladesh, saw 30 years ago that “it was becoming clear that microloans weren’t reaching the poorest households. Nobody wanted to lend to them because who knew if they […]
Relentlessly Testing the Little Champs’ Fitness Levels
Most small caps that show early promise falter as they grow and eventually fade into oblivion. The most common reasons are dubious accounting/governance practices that come to fore as these companies are tracked closely by investors, capital misallocations (often a result of overconfidence or lethargy) and lack of delegation/institutionalisation which inhibits the franchise’s growth. At […]
India’s Moment After a Decade of Structural Reforms
Between 1870 to 1940, America became the world’s most industrialised economy. During this period, with the emergence of railroads, the telegraph, cars and roads, the American economy was ‘networked’. This joining up of America helped efficient, well capitalised companies with competitive advantages to consolidate entire industries. After a decade of pathbreaking structural reforms, India is […]
Three Different Routes to Compounding Heaven
Lenders are leveraged business and have a unique business model very different from other non-financial companies. This makes it difficult to compare metrics of lenders with other companies. In this newsletter we delve deeper into such aspects of reinvestment rate, book value compounding and return on equity of lenders. For instance, for most non-financial companies, […]
Why Compounding is so Difficult
Another topical piece from the house of Akre Capital. In the past, we have featured Chuck Akre’s Three-Legged Stool investment strategy and Chris Cerrone’s The Art of (Not) Selling. In this piece, another partner at Akre, John Neff reminds us why compounding is so difficult given the markets currently. “Why do more investors not reap […]
‘If you work hard and succeed, you’re a loser’: can you really wing it to the top?
Mostly we value people with great work ethic – systematic approach, deep thinking and hard work. But every now and then we are in awe of those few who are spontaneous and end up pulling things off with sheer instinct. This article tries to understand if it is actually possible to succeed by just ‘winging […]
Learning how to think well involves hearts as well as minds
As one gets older as a professional, one runs into a knotty HR problem, namely, some of the most brilliant minds we run into Finance lack a moral compass. Since the education system does not measure morality, such people often have distinguished qualifications. However, since immorality gets found out in corporate life, such people often […]
A chat with Ray Dalio
Ray Dalio is the founder and co-CIO of Bridgewater Associates, the world’s largest hedge fund. Dalio is also known for his book – Principles which talks about his principles in Life and Work, some of which such as ‘Radical Transparency’ we have attempted to implement at Marcellus. His Youtube video on ‘How the Economic Machine […]
The Art of Listening
As Ernest Hemingway noted in 1935, “‘When people talk, listen completely… Most people never listen.’” Poor listening skills, says the author of this piece MM Owen – a British nonfiction author – afflict most of us. Listening he says is a powerful skill and master of listening was a psychologist named Carl Rogers: “Listening well, […]
The ESG Mirage
Across the world, the hottest investing theme for the past few years has been ESG i.e. funds where the investor purports to be making investments with Environmental, Social and Corporate Governance factors being central to choosing the assets which will go into the fund. However, over the past month, intelligence authorities across the developed world […]
Rising Giants Standing Tall Amidst Global Turmoil
The Rising Giants portfolio companies’ track record of sustaining healthy fundamental performance from FY12-21 despite several macro challenges gives us enormous confidence about the portfolio companies’ prospects. The earnings performance of these firms in FY22 (median portfolio PBT up 23% YoY) despite headwinds around cost inflation and supply chain issues further adds to our conviction. […]
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