The One Percent Almanack

Wit and Wisdom on Investing, Business, and Life

Vishal Khandelwal

Life 2.0: In Reading, Choose Depth Over Breadth

Seneca was a Roman Stoic philosopher who lived during 4 BC – AD 65. He was a tutor and later advisor to emperor Nero, and was forced to commit suicide for alleged involvement in the conspiracy to assassinate Nero (though some sources state that he may have been innocent).

During the last two years of his life, Seneca spent his time in travelling, composing essays on natural history and incorrespondence with his friend Lucilius. In these letters, 124 of which are available, he covered a wide variety of topics, including true and false friendship, sharing knowledge, old age, retirement, and death.

Here is what Seneca wrote in his second letter to Lucilius – On Discursiveness in Reading – which I am posting as it is here, and which contains the answer to the dilemma most of us face on what to read as investors (by the way, ‘discursiveness’ means moving from topic to topic without order) –

Over to Seneca.

On Discursiveness in Reading
Seneca wrote to Lucilius –

The primary indication, to my thinking, of a well-ordered mind is a man’s ability to remain in one place and linger in his own company.

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Benefits to VIA Members
 
  • Spotlight: Big ideas from Value Investing and why applying them in your investment decision making will be a great deal
  • InvestorInsights: Interviews with experienced value investors, learners, and deep thinkers
  • StockTalk: Thorough analysis of business models of companies (without any recommendations)
  • Behaviouronomics: Deep analysis of human behaviour and how it impacts investment decision making
  • BookWorm: Reviews of the best books on Value Investing and related subjects
  • Free Course – Financial Statement Analysis for Smart People (otherwise priced at Rs 5,900)
  • Archives: Instant access to our huge archive from the past three years
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Super Investor: Seth Klarman on Perils of Top-Down Investing

Reading the super texts i.e., words written by legendary thinkers, investor and philosophers is something that one can never get enough of. These texts are so deep and pack such a concentrated dose of wisdom that the only way to benefit from them is to read them again and again. It’s like a giant onion with densely squeezed layers. When you’ve peeled one layer, then and only then, the juicier layer makes itself available.

Seth Klarman is one such super investor and his book Margin of Safety is that super text which needs to be read every year (at least). And every time I read it, I discover a fresh insight and wonder how I missed it during my last read. It happens because once I get a grip on one idea, it increases (slightly) my mind’s ability to receive another idea. And bit by bit, over a period, brain muscles become stronger to imbibe the deeper wisdom.

I would go as far as saying this – if an investor hasn’t read a super text multiple times, he’s as uninformed as the guy who hasn’t read it at all. Warren Buffett’s letters, Benjamin Graham’s The Intelligent Investor, Poor Charlie’s Almanack are some super texts that demand revision multiple times.

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Want to Read More? This content is exclusive for members of Value Investing Almanack. Login to read if you are a member. Else, click here to subscribe.

Benefits to VIA Members
 
  • Spotlight: Big ideas from Value Investing and why applying them in your investment decision making will be a great deal
  • InvestorInsights: Interviews with experienced value investors, learners, and deep thinkers
  • StockTalk: Thorough analysis of business models of companies (without any recommendations)
  • Behaviouronomics: Deep analysis of human behaviour and how it impacts investment decision making
  • BookWorm: Reviews of the best books on Value Investing and related subjects
  • Free Course – Financial Statement Analysis for Smart People (otherwise priced at Rs 5,900)
  • Archives: Instant access to our huge archive from the past three years
Become a VIA Member. Click to Subscribe

Spotlight: If You Can’t Imagine, You Mustn’t Invest in the Stock Market

Apart from observation and deduction, if there’s an important skill that an investor or analyst must bring to the table while making investment decisions, it is ‘imagination’. It is, after all, imagination that helps us make relevant connections that are not entirely obvious, between data or information about a business that may appear disparate at first.

Logic will get you from A to B. Imagination will take you everywhere. ~ Albert Einstein

First comes thought; then organization of that thought, into ideas and plans; then transformation of those plans into reality. The beginning, as you will observe, is in your imagination. ~ Napoleon Hill

Having a five-year-old means that I’m always attuned to what’s new in kids’ entertainment – whether it’s books, movies, or YouTube videos. So, while browsing through the video library on my laptop some days back, I came across this video that was created to celebrate the 150th anniversary of Lewis Carrol’s children’s classic, Alice’s Adventures in Wonderland.

The emphasis in this video was on the use of imagination. The first scene presented Alice and her entire family having a Her family endeavour to convince her otherwise, pointing to possible mundane things that can become magical in their opening song: the rabbits in the field, the father’s pack of cards, or a caterpillar (of course prefiguring some of the best-known scenes in the book). And sure enough, the white rabbit appears, prompting Alice to follow him down the rabbit hole.
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InvestorInsights: Jason Zweig

Jason Zweig is the investing and personal-finance columnist for The Wall Street Journal.  He is the author of The Devil’s Financial Dictionary, a satirical glossary of Wall Street (PublicAffairs Books, 2015), and Your Money and Your Brain, on the neuroscience of investing (Simon & Schuster, 2007).

 Zweig edited the revised edition of Benjamin Graham’s The Intelligent Investor (HarperCollins, 2003), the classic text that Warren Buffett has described as “by far the best book about investing ever written.” Zweig also wrote The Little Book of Safe Money (Wiley, 2009); co-edited Benjamin Graham: Building a Profession, an anthology of Graham’s essays (McGraw Hill, 2010); and assisted the Nobel Prize-winning psychologist Daniel Kahneman in writing his book Thinking, Fast and Slow. From 1995 through 2008 Zweig was a senior writer for Money magazine; before joining Money, he was the mutual funds editor at Forbes.

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BookWorm: Shoe Dog

Phil Knight’s candid and riveting memoir of how he built Nike from scratch. Knight shares the inside story of the company’s early days as a fearless start-up and its evolution into one of the world’s most iconic, game-changing, and profitable brands.

It was 2005 when I bought my first pair of Nike. I wore them to work, for running, for outings and almost everywhere. I waited five years for those pairs to get torn so that I could buy new ones. They never did. Sturdy brats! I eventually donated them to make way for the new ones – another Nike – and since then I have never used any other brand.

I am sure millions trust Nike for its comfort, sturdiness, innovative designs, and cutting edge technology. Nike’s reputation is simply unparalleled. Its trademark – the swoosh – is more than a logo. It’s one of the few icons instantly recognized in every corner of the world.

However, I never knew that Nike was the brainchild of one man, himself an athlete. He borrowed fifty dollars from his father and launched a company with one simple mission: import high-quality, low-cost running shoes from Japan.

The man was Phil Knight. And  Shoe Dog is Knight’s candid and riveting memoir. He shares the inside story of Nike’s early days as a fearless start-up and its evolution into one of the world’s most iconic, game-changing, and profitable brands. Shoe Dog is nothing less than a business thriller and perhaps the best business book that I have ever read.

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