Ego & Portfolio Repair | Shyam Sekhar

本站添加: 2026-06-03

[00:00:05]In today's conversation, I'm going to take up the topic ego and portfolio repair.

[00:00:14]When we buy a new stock idea and then started to like it even more, we keep on adding.

[00:00:26]We keep on buying the same stock more and more. We start building volume. We start building a big position size.

[00:00:34]From the time you like an idea to the time the position size >> [snorts] >> of your ownership becomes significant, one thing happens.

[00:00:47]Your ego starts building up.

[00:00:52]And starts dominating how you start viewing the stock.

[00:01:01]Your entire perspective about the stock, which was from a distance before you came to know it, becomes deeply personal after you're bought it in volume, in quantity.

[00:01:17]If bad luck hits you and you're bought the wrong stock to such a quantity that uh you're not sure what to do now.

[00:01:30]And then you become very, very insecure after you're bought a lot of quantity.

[00:01:38]This is where the problem starts.

[00:01:42]Your portfolio may need repair, but your ego refuse to allow it. So, you're hoping that maybe there'll be some rally, some idiot will come and buy, I'll sell and get out.

[00:01:54]At that point, you start believing in the greaterful theory to come and help you get out of a mistake that you have made.

[00:02:05]Many times when we practice this we run the biggest risk of being that greater fool. Somebody who's already been fooled by somebody else.

[00:02:18]Because ideas come from different places. Somebody has fed an idea on us or to us and the idea has grown on us and now the idea is consuming us in a very wrong way.

[00:02:35]Today I'm going to discuss with Subra about his own experiences and how he dealt with this because it's very normal for us as investors to find mediocre ideas.

[00:02:51]And there are times when we get into the wrong ideas or even bad ideas. Subra.

[00:02:56]Ego and portfolio repair starts with a bad idea. So start from there and tell us.

[00:03:05]>> No, it not only starts from a bad idea, it also happens because you don't have rules for yourself.

[00:03:13]You may have rules for others, but you don't have rules for yourself saying, "Oh, now it will recover." So, if I like the share at 100 rupees, I like it more at 90 and I like it much more at 80.

[00:03:23]Because then you say, "Oh my god, this is a great share, good dividend yield. I should buy more." And all that. And suddenly I find that the EPS itself has disappeared. So, there's no question of dividend and dividend yield. So, these kind of things happen. So, basically, in the market the price is the only thing that you know. Everything else is your guess.

[00:03:43]So, you have to accept that the market is trying to tell you something >> through the price.

[00:03:48]>> Through the price. That's all. It's not I mean, maybe it's a great share, but it's not working in the market. So, you have to have two types of at least I have in my portfolio two types of stop loss.

[00:03:58]I bought a share for 100 rupees. It goes to 90. In most cases, I would sell it off because something the market is telling me which I don't want to hear or listen.

[00:04:08]>> [snorts] >> And the second stop loss is if I give it time. So, I bought it at 100 rupees. It is at 100 rupees for 6 months, 8 months, 1 year, 1 and 1/2 years.

[00:04:18]Then I lose patience and I sell off.

[00:04:19]Maybe I'm wrong. Maybe it will recover, but in most cases I it is better to look for a fresh idea which will work.

[00:04:26]Unless [snorts and clears throat] I'm convinced that there is something extraordinary about this company. Then I go around, talk, find out about it from other people.

[00:04:34]>> [snorts] >> And if I can't get convincing answers, you know, one thing I have always felt, if you're trying to buy a house in a place, go and tell the broker there that you want to sell a house.

[00:04:45]Then you'll say, [snorts] "Oh, nothing can be sold here. It is a bad place.

[00:04:49]Nothing can be sold." etc. And then you tell him, "No, actually I want to buy."

[00:04:52]Or you go to another broker and see what all he says. They always tell you what you want to hear.

[00:04:58]Or they try to make it more difficult and say, "Look, I'm making it easy for you." So, you will always hear those kind of things.

[00:05:04]So, when [snorts] you find a good company or you think it's a good company and it is not working for you at that point in time, maybe later on it will work.

[00:05:14]You have to with tremendous rules and regulations for your own self.

[00:05:20]>> [snorts] >> You have to get out because get out because it's a 10% loss. It's as simple as that. Maybe the same idea you bought the share at 100.

[00:05:27]>> control a bad idea through stop loss.

[00:05:29]>> Absolutely because But what about those who don't do stop loss? How do they psychologically take care of this? Some people >> don't. Then they just wait because somehow there is this theory called my price theory.

[00:05:43]So, even if they bought a share at 100 and then it goes to 170 or 180. They don't sell and then when it comes down, they'll say it will not go below 100.

[00:05:52]You know, because they think the price the share knows the price at which I bought and they think it will not go below that. Then they will wait, they will wait, they will wait. 110, sell off now. No, and then when it goes to 100, they will sell off. Or sometimes they will not sell off even then. And then the price comes further down and they no clue. See, if you don't know why you bought, how will you know when to sell?

[00:06:14]If you bought to keep it for the rest of your life, then it has to be a fantastic share with a good dividend yield.

[00:06:19]Something some story has to be there.

[00:06:21]>> [snorts] >> If there is no story, nothing is getting built up, what will you do with it?

[00:06:26]>> It's fair enough.

[00:06:27]So, you're saying that you cannot story fire on your own.

[00:06:33]And sometimes the market also may not story fire idea just because you bought it. Your price doesn't matter.

[00:06:39]If the idea is wrong, you have to sell.

[00:06:41]>> You have to sell. There is no choice.

[00:06:43]>> So, from your experience, suppose you have sold the stock. You're saying 10% I sold off. The stock again goes up above your cost and goes another 20% above the price at which you sold.

[00:06:59]And then again you're hearing good things. Will you again go back into that stock?

[00:07:01]>> Yeah, I I treat them as separate transactions.

[00:07:05]Let's [snorts] say I bought the share at 100. I sold it off at 90.

[00:07:09]Then [snorts] it goes it goes up to 95. Does it mean I won't buy it? I may buy it.

[00:07:14]>> No, but you hear that the company is a bad company but the price moves up. Will you buy it? You are convinced that the company or the management is not a good reliable entity.

[00:07:23]>> No, then I wouldn't buy it just because the momentum is there. Because I've already suffered 6 months or I suffered 1 year, nothing has happened. Then you hear the company has done this or you hear it from a broker.

[00:07:33]Uh >> [snorts] >> you know who is rigging the share price.

[00:07:34]There are such brokers. When they call you and say, "Oh, this share is good."

[00:07:38]Uh you know something is wrong with it.

[00:07:39]I remember I'm not naming the company. I bought the share at uh I think it's 72 rupees.

[00:07:45]>> [snorts] >> Then I told another friend of mine who is also a broker. I said 72 rupees I bought because I think the managers management is going to share take the share price up. Complete rigging case.

[00:07:55]And that [snorts] time the price was 70.

[00:07:56]He said, "Hello, yes it is going up. The going up is over. Now it is going to go down." I sold. I sold it a loss of 2 rupees. The share price then went down to 9 rupees.

[00:08:06]Right? So, ear to the ground, somebody telling you a story, you will react. It is not possible that you don't react. You may react with a small amount and say, "Okay, let me take a chance." But you have to have your own rule. So, if I bought it at 72 and I had not spoken to my regular broker, I would have sold it off at 63.

[00:08:23]>> Okay.

[00:08:24]>> I wouldn't have waited it for to come it come to 9 rupees. I wouldn't want to lose so much money in a bad decision. So, I'll cut my losses.

[00:08:33]>> So, effectively you use stop losses to cover your tracks.

[00:08:38]>> Correct.

[00:08:39]>> And to put yourself in a safe position.

[00:08:41]>> It actually helps in two ways. If you do a stop loss, the share is out of your portfolio. Otherwise, you look at it every day and makes you feel bad. Idiot, you bought it at 70, now it is 60, now it is 50, now it is 40. It's laughing at you. It is laughing at you. I'd rather get rid of it and say, "Get out. Get into the garbage can. I don't want to see it on my portfolio." Or sometimes, you know, the market is not treating it well.

[00:09:04]You have to get out. Wait for that to I I mean, I remember, let me talk about this share which I think it was I thought it was a good buy at 107. Now I think it is down to 70 rupees. But at 95, 85 and all, I just got out. I said, "Something is wrong. I think it's a good buy at 70. But at 107, maybe it was not a good buy." So, that I got wrong with the price. Uh good industry, everything else when everything else booms is I thought this industry will boom, but that particular industry is not doing well. So, somewhere >> When people buy a stock and it falls and then they hear that it's a bad company.

[00:09:37]Many times their ego tells them that they should not make a loss in that stock. What will happen when >> No, see this is the problem. If I have lost money in ONGC, I think I've to make money in ONGC. That is not true.

[00:09:50]You lost money in ONGC, you can make money in Coal India. What stops you?

[00:09:54]Money doesn't know, your portfolio doesn't know where you lost and where you won.

[00:09:58]>> So, you don't believe in the theory that if you lost money in a stock, you must make it up in the same place. Or wherever you lost >> Sometimes you can't. Sometimes you can't. And you're making money elsewhere because you look at it and say, "Okay, here I'm making 3 lakhs loss." Then you look at your total capital gain for the year is 38 lakhs. You say, "Take the three and pay tax on 35." That's it. You just move on.

[00:10:16]>> Fair point. So, you'll see numerous investors uh >> [clears throat] >> give us some examples where an investor let's see his ego run too far and now refuses to sell.

[00:10:28]Also, give me an example later about an investor who actually constructively uses ego. I want two examples of the ego.

[00:10:35]One not doing good to the investor, one actually helping the investor.

[00:10:41]>> [snorts] >> I really don't know whether it is only ego because what happens is suddenly when the portfolio is not doing well, they're willing to listen to anybody.

[00:10:49]So, they if it's a woman, she will be listening to her husband. If it's a man, he could be listening to be listening to his friend. He could be listening to his broker. He could be listening to three, four people.

[00:11:01]Then he's actually confused as to what to do. Then if he comes to me, I don't want to become my advisor number four or advisor number five. So, I don't say anything. I just look at his portfolio and say, "It's okay. Maybe you have to wait." To do something like that and get away.

[00:11:14]Now, I'm not even actively into consulting. So, now I do not know whether things have got worse.

[00:11:19]>> [snorts] >> So, one is that. Second is people who are willing to say, "Okay, let me make the rules. Let me say because your money doesn't care about your ego, right? So, I keep telling this to especially those people who have inherited a portfolio. I tell them if your father was here, he would have sold it.

[00:11:35]Don't uh keep it just because your father bought it and it was your father's decision. At that point of time, it was a good company.

[00:11:42]Right? I mean, companies >> Yeah, this is another issue which I we have seen many people who inherit a portfolio. They refuse to sell saying that oh, my dad bought it. I don't want to sell it.

[00:11:50]>> but if you were still holding Nirlon and Mafatlal Industries, you know, where is where are those companies? Those [snorts] companies have been taken to the cleaners. Why would you still hold on to >> Like you take given South-based companies. Only one or two groups have actually done well, Chennai-based.

[00:12:04]>> Correct. Correct.

[00:12:05]>> Rest of all kind of vegetated. So, if you're having a portfolio which your father built with all the Chennai-based companies, right? In which 60% are guys who are not doing well and 40% are these champs.

[00:12:19]Uh you have a fair chance to get out of that 60% in a good market. And you know, put the money either in these champs or in some other geography, in some other state. Most people, they just vegetate and they sleep through all this.

[00:12:30]>> No, what happens, you know, when you see old portfolios, one or two shares have done so well, it's like a big carpet under which all these can be hidden. So, one Asian Paints, one MRF, one MRF has made so much money for them that that family thinks oh, he's a great investor. Maybe that was luck. Whatever it is, then keep MRF. I'm saying nothing wrong. Sell the others because it's already become a concentrated portfolio.

[00:12:57]You're already 90% in MRF and all the other कचरा is only 10%. Don't sell MRF, but at least get rid of the others.

[00:13:03]Don't buy MRF with that, but buy, you know, you can be single stock. You're just holding MRF. That's okay, but sell the others and put it into a mutual fund. Do something like that.

[00:13:11]>> [snorts] >> This is not even ego, you know, it is like saying my father was such a genius.

[00:13:14]He built this portfolio. Fine, he was, but he died. In fact, uh Shyam, I'm able to look at a portfolio and when he says my father died in 2023, I know [snorts] that from 2019 he has not been paying attention to that portfolio. Because last 3-4 years maybe he had Alzheimer's or you know some illness so he's not looked at his portfolio. That is also visible that 2019 active management stock. If you don't know how to manage >> Yeah, 2018 bull run stocks even today are lower than that price.

[00:13:41]>> Yeah.

[00:13:42]>> Similarly 2023-24 bull run stocks are going to be lower for a long time.

[00:13:46]>> No, but if he was a smart investor with that 2018 portfolio, he may have got out in 2018 or 2019.

[00:13:52]>> Even 19.

[00:13:52]>> Uh he may have got out.

[00:13:54]>> bull run stocks even 26 he can get out and buy something else.

[00:13:56]>> Correct.

[00:13:57]>> But the ego saying that oh I saw that high price today it is lower by 30%. Let me wait for that high price. That high price was of course not the plan. It came outside the plan.

[00:14:09]Today's price is still a very respectable price compared to the cost.

[00:14:12]But the anchoring issue is the peak price.

[00:14:14]>> No, let me let us take an example only.

[00:14:16]Reliance Capital.

[00:14:18]We've seen it at 200-300 at least at 150 we've all seen it. Today it is at 12 rupees.

[00:14:24]At some stage you have to get out. But if I ask somebody to get out today at 12 saying the price won't come and 3 months later it is 24 he'll say see it has doubled.

[00:14:34]But he's not waiting for double. He was waiting for 137.

[00:14:37]I don't know when it will go to 137.

[00:14:39]Whether it will [snorts] go to 24 also I don't know. But today I know it's at 12.

[00:14:43]My decision is I won't touch it at 12.

[00:14:46]But if you had bought it at 137 what should you do? I have no clue. This is not so much about ego also. It is like not wanting to look into the mirror. Not not wanting to acknowledge the loss. The losses happened. If you don't sell it it is still a loss. If you sell it you're just acknowledging you may actually be reducing your capital gains. Somewhere else you have made money at least set this off.

[00:15:11]>> At least tax efficient.

[00:15:12]>> At least it's tax efficient to sell it off and even you sell it at 12 bucks and if it goes down to 8 bucks you buy it back. If it's your ego which is >> No, I'm going to uh bring you to the next subject. That is when you sell this kind of shares some money comes out.

[00:15:25]What more needs to be done to repair the portfolio? Some liquidity we have got.

[00:15:29]What more can investor do to repair the portfolio and bring it back to the pink of health?

[00:15:33]Other than selling.

[00:15:37]Or after selling?

[00:15:38]>> After selling when you have the cash See, first of all when you're 25 >> [snorts] >> and you fool around with your money, there's very little you can lose.

[00:15:47]Because out of your own money, you can still lose your father's money, that's a different thing. But you have very little you can lose of your own money.

[00:15:53]By the time you get to 50, you have to understand that this money is now required till you die at 90. Right? So, this is now very important not to lose money. Not to lose money becomes very important once you have a reasonable size portfolio.

[00:16:08]If your portfolio is small, it is different. Now we have to protect it. I think it's a good time to seek advice.

[00:16:14]And sit with somebody who knows the market, who knows you.

[00:16:18]But again, there is >> You need serious counsel.

[00:16:20]>> You need serious counseling because what happens is if there is somebody, it's your cousin or my cousin, they don't want to show us the portfolio. They think we'll be jealous or whatever. So, within the family nobody comes to show their portfolio and ask what happened.

[00:16:34]So, whether they So, that is again I think about ego, being secretive, not wanting to show. Don't come to me, but go to somebody else. Have a health check.

[00:16:43]It is nice to have somebody else viewing your portfolio because you will get biased. You will get biased. a friend, get anybody, pay professional fees, get it reviewed.

[00:16:53]>> [snorts] >> So, the repair will start beginning to happen the moment you approach the right person who will give you an objective view.

[00:16:59]>> No, the repair will start happening the day you know that it requires to be repaired.

[00:17:04]>> Okay, self-awareness.

[00:17:05]>> Self-awareness.

[00:17:06]>> And then you go to a person.

[00:17:07]>> Uh you see >> So, the repair continues through that person. Then it again once you're given patience or suggestions, what should you do?

[00:17:14]>> No, I am saying uh when you're protecting the First of all, whether the man is earning or the woman is earning, this is the joint property of all the four. You have got married to a woman and you have had She has had your children. So, these four people are very important to the portfolio.

[00:17:31]And if your kids are above 14, 15, you can involve them also. Because here it's a joint decision which you're taking, which will allow your ego to be held back and said, "Okay, not my ego alone, my wife and all everybody agreed, therefore we bought and therefore you can seek counseling." So, first is self-awareness, bringing the family in and saying, "Look, I've been getting 9% return. This is not great. Seven [snorts] is what we would have got in PPF or a bank deposit. 12 is what we would have got in a well-managed mutual fund. I'm at nine. I'm not doing too well. So, I'm seeking counseling." And then if you can get a good counselor, start putting money into mutual funds or some large cap fund or something like that.

[00:18:13]>> Okay.

[00:18:13]>> All [snorts] the repair money you put there. It may not give you great >> So, you're saying the money that comes from repair at least you put in mutual fund or some safer place. Let it compound and >> Even in the mutual fund, don't put into silver ETF or something like that. Put it in a safe, big, flexible fund.

[00:18:26]>> Erosional Capital should be arrested.

[00:18:28]>> Absolutely. You may not get great return, but at least in the mutual fund if you do a five-year or six-year SIP in a say a balanced or a multi-asset fund, I don't think you can get negative returns.

[00:18:38]So, anybody who comes to me and there is one lady who says, "Oh, Subhra, if I invest through you, I never lose money."

[00:18:45]It is her behavior. From 2007 or 2008 to 2025, she has never removed money.

[00:18:52]Which is what giving is giving her great returns. It may not have been top quartile performance or, you know, somewhere there, but she's still not lost money. That is the biggest thing you can do for yourself. Don't lose money.

[00:19:03]>> And never forget that.

[00:19:04]>> Uh, never forget that. And I when I'm saying don't lose money over long periods of time, right? So, set it right by getting your family involved it is their money.

[00:19:15]>> So repair begins when the ego accepts that you are wrong recognizes that something needs to be done exits whatever it considers a mistake creates liquidity to be invested elsewhere. Hopefully invest that money either in his own other ideas which are winning ideas or in a mutual fund ecosystem so that that repair and recovery happens independent of his own investing which he's doing personally.

[00:19:45]>> Oh Sham, I may be old-fashioned but I can't put in a reasonable amount of money without speaking to two three people.

[00:19:54]>> Okay. [snorts] >> In the WhatsApp >> everyone is like that.

[00:19:57]>> Yeah, I was like I can't go online and buy something because somebody told me.

[00:20:01]I have to still call up somebody in Bombay, somebody in Chennai and say, "Hey, what do you think of this? Is the management good?" and all that. So having I keep saying this that having two good people to whom you can talk is what >> Very very very very important. It's most valuable. I will agree with you.

[00:20:16]>> You If you don't have that then that equity becomes a nightmare.

[00:20:20]>> Absolute absolute nightmare. Agreed.

[00:20:22]Totally agreed.

[00:20:22]>> So don't do it unless you have these two people whom you can talk. It could be >> And those two people, how will they help you manage your ego better?

[00:20:29]>> Correct.

[00:20:29]>> How will they tell me?

[00:20:30]>> No, they they will tell you, "Are you an idiot? Stay away." So you have to respect their views also. There's no point in >> And you have to bring those people into your life. They will not come on their own.

[00:20:40]>> They may not come on their own.

[00:20:41]>> They have better things to do.

[00:20:42]>> No, and they may think, "Why should I give you advice?" Advice has to be sought. The first thing I learned when I did CA first day our we are we are part of a foreign firm so they all said people have to seek advice and pay fees otherwise it is free advice which is ignored.

[00:20:59]>> If you go and give it voluntarily it's free advice.

[00:21:02]>> It is free advice and they >> And it's not respected also. That's the bigger part. It's not even the >> They already say, "Oh, my husband told me my they will argue with you. They'll argue with you. Then you also lose why do you want to lose your head over somebody who's not interested in your advice?

[00:21:15]So [snorts] if people are interested in advice then only you can give advice.

[00:21:19]>> Supra, there have been many occasions when the ego tends to drive your decision-making. I've also seen it. I felt it.

[00:21:27]It's when we make our investment decisions deeply personal.

[00:21:32]What came out in this video is make it impersonal.

[00:21:35]That's the only way you can keep your ego in check and you can allow your decision-making to succeed because the ego tends to disrupt your behavior in a way which makes decision-making inferior.

[00:21:51]So the key thing should be at all times we try to improve our decision-making and keep the ego in a position from where it helps us make better decisions and this simple idea is so difficult to practice mainly because we allow our ego to run ahead of us and then we go chasing it and then end up in the wrong place from where there are no comebacks.

[00:22:19]So timely control of the ego and timely correction of egoistic decisions is something that will take us a long way in investing and I'm sure you have experienced this. I am experiencing this too.

[00:22:32]And learning this is very important for every investor. I'm sure this video when watched by number of investors >> Also I'll also tell you when your children look at you and they think oh you've done a great job telling them about your mistakes keeps them more secure.

[00:22:47]They think oh we are also making we can also make mistakes. Our fathers and mothers have also made mistakes and I see fund managers great one of the greatest things about some fund managers is their humility. They say oh Supra what do >> They talk about their mistakes.

[00:23:01]>> They talk about their mistakes. I have made many videos on my mistakes. You make mistakes, accept it and come out.

[00:23:07]Don't let your ego hurt your purse.

[00:23:10]>> Correct.

[00:23:11]>> That is the first thing.

[00:23:13]>> So, on that note, we'll close this video. Don't let your ego hurt your purse.

[00:23:20]Repair decisions which are relying on ego and not supported by fundamentals soon enough so that those decisions don't hurt your wallet.

[00:23:33]Thank you for watching this video and thank you Subra for this wonderful conversation.

[00:23:36]>> My pleasure.