The Dhandho Investor By Mohnish Pabrai Pdf Free

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The Dhandho Investor By Mohnish Pabrai Pdf Free Rating: 4,3/5 896 reviews

I can honestly say that I have been looking forward to reading this book for months. Ever since I watched Mohnish Pabrai's Google Talk on Youtube, really. As I've mentioned before, I am a voracious reader. At the moment, we are relaxing with family for a week in the Midwest, before continuing on our extended road trip. This downtime has given me plenty of time to read, and a different library system from which to choose my selections. In this case, I was thrilled to see that the local library had The Dhandho Investor available for loan.

Daniel Wahl reviews The Dhandho Investor: The Low-Risk Value Method to High Returns, by Mohnish Pabrai.

In this book, the author brings an engineer's clarity in sharing his low-risk value investing methodology. The premise of Dhandho investing is, as the author repeats time and time again, 'heads I win.. tails I don't loose much'. Let me rewind for a second. The author tells us, 'Dhandho is a Gujarati word.. from the Sanskrit root word.. that means endeavors that create wealth'. He goes further to say that the common street translation is simply 'business'. So the reader immediately recognizes that this methodology is the Indian/Pakistani/Bangladeshi mindset for conducting business and investing.

The central premise of this book is that high business/investing returns are not inseparable from high-risk opportunities.. as we have all heard from mainstream academics. Intuitively, this makes sense to me. I am not a staunch believer in the Efficient Market Theory, instead believing that global equity markets are generally inefficient. It is at those times of inefficiency that I have tried to make my largest investments. The author tries to do the same and has a fantastic record of investment returns to show for it. He is quick to tell you that he didn't invent this investment methodology. In fact, he readily admits that he is a ready cloner (or imitator) who has succeeded by imitating other successful investors. Namely, Warren Buffett. Yep, while his investment methodology is very similar to the one Warren Buffett employed in his early partnership, the structure of the author's partnership is virtually identical to that of Warren Buffett's early partnership. If you're going to imitate someone, you might as well go for one of the best investors of modern times.

In a single sentence, this business/investing methodology encourages the practitioner to recognize a given venture's potential upside and downside, but only go ahead with the venture when the potential downside is limited and the potential upside is significant. As the author puts it, 'heads I win, tails I don't lose much.' The thought process goes that if you only invest (or risk capital on a business) when the odds are slanted in your favor, you are far more likely to succeed over time. This concept makes sense to me intuitively and is how my wife and I try to invest.

Make no mistake, the author's investment methodology is different from how Buffett and Munger currently operate at Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B). While Warren Buffett has repeatedly said his 'ideal holding period is forever', the author ideally holds an investment for 1 to 3 years. Additionally, the author's partnership fund typically holds just a few investments, while Warren Buffett controls an enormous stable of companies through the Berkshire Hathaway conglomerate. I think the simplest way to explain this divergence, despite the author's admiration and imitation of Warren Buffett, is the relative amount of capital they each employ. When Warren Buffett ran a partnership fund, of just a few million dollars, he invested very much like Mohnish Pabrai does today. Now that he is responsible for investing the tens of billions of dollars Berkshire Hathaway controls, he needed to alter his investment methodology. The author, I, and (presumably) you do not have such a limitation.

In the book, the author provides a thought provoking discussion about many of the most successful investors and entrepreneurs of our time. Everyone from the stereotypical Indian immigrants (in the hotel industry), to Richard Branson and Bill Gates is discussed. In all of these cases, new enterprises were low overhead activities funded with little capital and lots of sweat equity. If the businesses took off, the owner could scale them and reinvest the profits. If the businesses floundered, the founders weren't much worse off for trying. The author also discusses his own technology service company, which he founded in the early 1990s. Mini split york mexico. He started it in his free time and didn't quit his day job until he had reached certain revenue goals. He did, however, fund part of his venture with credit card debt, which I wouldn't recommend, but the book doesn't dwell on that topic.

My business partner and I are currently starting a new business, and I thought it was interesting to look at our venture through the author's Dhandho lens. I think it's funny that our new business fits the Dhandho model to a 'T'. The venture employs low overhead, no debt, and lots of sweat equity. After reading this book, I am even more confident that we are on the right path.

One aspect of the book I was not expecting, but greatly appreciate, was the amount of time the author spent discussing how he finds his investment ideas and his suggestions for how the reader could do the same. When an author goes this route, they are often selling their own newsletter service or some such. That has been my experience anyway. Instead, this author had several suggestions for utilizing free services (either at the library or online). I greatly appreciate the suggestions, because while I have utilized a couple of the suggested services for years, there were several others of which I was unaware. Knowledge and ideas are power, and the author of this book doesn't hold back his thoughts.

He also spent a while discussing Kelly's Probability, which is a 'back of the envelope' type of probability calculation. The Kelly method can be used to ballpark the maximum amount of capital that should be invested in a given venture, based on the probability of the various outcomes. As with all calculations, garbage in begets garbage out, but this method can be useful when selecting the amount of capital an investor wants to put at risk on a particular venture.

After reading it, I will certainly be adding The Dhandho Investor to my business/financial library soon. The author did an outstanding job of weaving business/investing theory with common sense and the stories of some of the most successful modern investors (and business leaders). The information was laid out in a simple fashion that almost any reader could readily digest. Additionally, the author was not shy about discussing his investment methodology and the resources he utilizes (for free) to collect and research those ideas. This book is a win/win all the way around.

Disclosure:I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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A comprehensive value investing framework for the individual investor In a straightforward and accessible manner, The Dhandho Investor lays out the powerful framework of value investing. Written with the intelligent individual investor in mind, this comprehensive guide distills the Dhandho capital allocation framework of the business savvy Patels from India and presents ho..more
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Published April 6th 2007 by Wiley (first published January 1st 2007)
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The Dhandho Investor: The Low- Risk Value Method to High Returns
047004389X (ISBN13: 9780470043899)
English
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Rating details

Oct 04, 2018Rohit Enghakat rated it liked it
This is a good book on investing fundas in the equity markets from a very well known name in the American capital markets. I had first come across the author's name when he became famous in 2007 for buying dinner with Warren Buffett along with his partner at Buffett's annual charity auction. Enamoured more about this event than by the author, I had written an amateur piece on value investing on my blog (value investing). So when I came across this book written by Mohnish Pabrai, I just couldn't..more
Aug 28, 2011Tyler rated it liked it
“The Dhando Investor” is a stripped-down recap of Warren Buffet’s investing principles. But then again, all Warren Buffet claims his ideas to be- are a recap of the “value investing” principles first espoused by his mentors Graham and Dodd.
Different from Pabrai, however, Warren Buffet is incredibly articulate. In giving the ideas of Graham and Dodd new relevance, primarily through his unparalleled investment track record, as well as his ability to communicate complex ideas in clear ways, Buffet
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Jul 09, 2009Scott Dinsmore rated it really liked it
Why I Read this Book: Pabrai has proven his application of value investing to be hugely successful. I wanted to learn what made it real for him. He has been a great teacher.
Review:
I just finished The Dhandho Investor for the second time, and doubt it will be my last. A quick and inspiring read that will have anyone believing value investing is the only true way to amass significant wealth in the market over the long run. At 18.8% a year since 1999, the author has the track record to prove it.
I h
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Pabrai writes a great book, with relevant examples and lucid writing , that deeply enhances value investing .
Oct 29, 2014Jonathan Perez rated it it was amazing
I first heard about Monish Pabrai in Guy Spier's book the education of a value investor. Considering how much praise he received and bearing in mind the famous WB lunch, I got curious to learn more.
This book is a useful reminder that value investing is about seeing things everywhere in life as risks vs rewards. When the reward of taking action is much greater than the risk, it makes sense to do it. Heads you win, Tail you don't loose much. It is true in investing. It is true in entrepreunership
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Apr 23, 2018Univpurpose rated it liked it · review of another edition
The book is nice and I understand the thought process with the margin of safety etc. So that ways, it tells some nice things. But I think I have read far too many books to understand the same concept. I was thinking (to hoping) gain better insights around the Pabrai thought process and while the book did explain that, I felt I was reading the same stuff as Warren Buffet newsletters which I can get for free - buy with moat, margin of safety, durable competition, etc.
What I did like though were h
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This is a brilliant book. It is an introductory book on investing. It takes an example of small businesses to make you understand the complexity of investing. Book emphasize the principle of investing in a simple business which you clearly understand. Book also talks about investment strategies of Pabrai Investment Funds which is very much influenced by Warren buffet ideologies.
Overall it's a good read.
The author compares motel owners who migrated from his native India as a metaphor for value investors. I don't get the connection between people willing to eat, sleep and live in their own properties to make ends meet and a person buying undervalued stocks. Some valid points, but the premise is questionable at best.
Two key takeaways-
1. maximise your returns by maximising rewards and minimising risks. Make few bets, big bets and wait for the right pitch while doing so.
2. all knowledge is cumulative. aim to read voraciously, wait patiently and swing big but infrequently.
Feb 12, 2015Richard Knapp rated it it was amazing · review of another edition
Down to earth
Pabrai tells of the Indian domination of the small hotel market across the US. He then uses stories from that culture to make his investment points..and he is right in his observations.
Sounds like total bullshit. I'm sold!
Actually, I'm not going to read this book.
I read this book in one sitting. It blew my mind. I seemed to have highlighted half the book. It has now become a guide.
Oct 26, 2017Manoj rated it it was amazing
A must read for anyone interested in understanding the basics of investing. This is probably the book you should start with. In simple language (no greek) , Mohnish explains how to go about zeroing in on one investment among the sea of options. There is even a chapter about how/when to get out of an existing investment. Believe me, this part is difficult, as it was for Abhimanyu.
Highly recommended reading for everyone. The younger you are when you read this, the better.
Cheers and Happy investing
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Jan 17, 2018Gaurav Parab rated it really liked it · review of another edition
Good, useful read
If you have read the Snowball, you will find this to be a simplified version using an example we can all relate to. Wish, this had an edition for the Indian context as well.
This is the first book I read on value investing. It covered many ideas and was a great introduction.
This book is full of great advice. Highly recommend.
Good piece of information on what, why, how, where to invest .. excellent financial education . Thank you pabrai for the master piece .
This book was recommended by Phil's Town. I was not able to gain much from this book. Perhaps if i was a multi millionaire or something i might get even more nuggets from this book. For normal person i would recommend just read first few chapters, that's where the gold will be found
Resourceful for people who want some basic insights to get in the world of investement. I found this book a bit simplish (one of the guidelines given by this book is to buy when the stocks/business is cheap and sell when its value is higher than the initial price, really ???) .. or maybe I have placed my expectations very high given the ratings the book has. It was not a waste of time for me at all: I found out that investing in stocks is not made for me, at least for now.
I have been struggling to read The Intelligent Investor for more than a year now. Its written in the english of an older time so the fluency takes some time to get a grip on, and its more technically written.
Dhando Investing is much more accessible and concise presentation of the content and methodologies of The Intelligent Investor, and spurred me on to pick up that master title again. I am reading it with much greater ease after having enjoyed Dhando Investor.
The book starts very colloquially
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Awesome book on value investing approach. Pabrai knows something about the topic and writes in a succinct but easily understandable way of explaining his investing philosphy. Every word and page seemed to be chosen with economy in mind. And yet you walk away with a very solid understanding of the 9 key concepts that Pabrai has learned over the years from the examples he uses along with guys like Buffet, Graham, Spier, and others. This is not an exact how-to manual and I don't think one could be..more
Mohnish's journey until 2007 before he realised that he had ignored quite a few other risks.
Proponent of running a concentrated portfolio - but that changed after 2007/08
A Margin of Safety makes you skip most opportunities that come your way - example of Mittal, Branson, and the Marwari philosophy.
Was optimistic about Chipotle and guess he was right - from 70 a share when he wrote to 300 + now.
Pg 114 - good explanation of permanent loss of capital - hence, makes sense to get into low risk high u
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Oct 24, 2011Milan rated it really liked it
This book by Mohnish Pabrai describes the concept of value investing in the simplest terms. Even a person new to investing could get a good idea of how value investing really works. He is honest enough to say that he has very few original ideas. He is an unabashed admirer of Warren Buffet and Charlie Munger. Where this book lacks is that he has not discussed the mistakes that he has made and how he has learnt from them. He does not go into the detailed analysis of the cash flows of the companies..more
Interesting simple basic approach, presented with a bit forced Indian analogies and lots of repetition (how many times can you read 'Heads I win, Tails I Don't Lose Much'?).
From time to time, the author goes into technical analysis and probability estimation with poorly based constructions. I understand stock valuations work within unknown/uncertain territory, but the process description ends up being too simplistic, with technical support and context referred in insufficient terms.
There is stil
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Nov 11, 2016Iliya Polihronov rated it it was amazing
Monish is a proven successful investor and he has basically laid out the way he makes his investment decisions. I find especially courageous that he not only describes success stories from his past investments, but also investments that he was in when writing the book. The book is easy to read and doesn't contain a lot of terminology. I also think that there is a gem to find in there for any investor, no matter how much or how little experience they have.
Jan 09, 2015Cyrus Molavi rated it really liked it
In The Dhandho Investor, Pabrai evangelizes a method of investment in plain words that turns out to be value investing. Its principles are clearly laid out and plenty of examples are given. The book does a good job of introducing the topic and referencing practical resources to take next steps in few words.
Awesome book- the author differentiates between risk and uncertainty. He expounds on buying businesses on those which are low risk but may have high uncertainty as the securities are more often than not mispriced. One of the rare persons to differentiate between these two concepts. In my opinion, it's still a difficult task to undertake but is important to keep in mind when analysing companies
Mar 11, 2016Janet rated it it was amazing
This book was recommended to me as I began my journey to learn more about investing my money. Mohnish Pabrai really simplified concepts into terms I could grasp. It has given me the confidence to continue to manage my own portfolio as I learn to search for businesses that are worth investing in. It was inspiring.
Muito inteligente os ensinamentos sobre investimento. Pode-se aprender novos conceitos e novas linas para pesquisar mais 'value investment' porém ele divaga um pouco quando começa a contar sobre a história de alguns empreendedores de sucesso, deixando um toque de falácia de narrativa.
Feb 16, 2016Leandro Melendez rated it it was amazing
Corto y muy interesante, aunque escupe la valuacion de empresas un poco de golpe. Pero aun asi muy iluminante.
Basicamente el Dandho, es estar en apuestas donde si gano, gano muchisimo, y si pierdo, solo pierdo un poquito. O no pierdo nada.
Muy recomendable!
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Mohnish Pabrai is an Indian-American businessman, investor and philanthropist. In his Pabrai Investment Fund, which is a family of hedge funds inspired by Buffett Partnerships, he successfully manages over 500 million of assets and consistently achieves above-average rates of return.
“The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather determining the competitive advantage of any given company and, above all, the durability of that advantage.4 —Warren Buffett” — 2 likes
“Einstein also recognized the power of simplicity, and it was the key to his breakthroughs in physics. He noted that the five ascending levels of intellect were, “Smart, Intelligent, Brilliant, Genius, Simple.” For Einstein, simplicity was simply the highest level of intellect.” — 1 likes
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