Most of the religious beliefs are because of the immense faith the person following the religion has. He or she may not be practising the rituals, but the faith generally is very strong. It is very much needs to be strong too.
Let us understand this with a small story.
A Dip in Ganges rids you of Sins and spiritual impurities
There is general belief that if you have a Dip in the river Ganges, which is supposed to be a holy river, flowing from North to East of India, your sins and spiritual impression be cleaned and you will be pure human being and that you will reach heaven, after you die.
One day, in their abode, Goddess Parvathi asked Lord Shiva. ” if everyone were to dip in Ganges and have themselves purified, they all will reach heaven. I doubt, if we have enough space to accommodate all of them. It will be mad rush and a stampede here”.
Lord Shiva smiled and said ” Don’t you worry. It will not happen. I will explain you, why it will not happen. Tomorrow, both of is will go and have dip in the Ganges and I will pretend that I am drowning and you need call out for help. But you must put a condition, to the person who wants to help me from drowning”
As planned, they dipped in Ganges and the old man slipped the lady shouted for help. Many turned their attention to them and were to jump to save the old man. But the lady said, only a person, who is pure and rid of all sins can save my husband. One hearing this ever one stepped back and there was no one to help her and the old man. Everyone thought they were not pure with lot of impurities.
At this point, a young saw the old man drowning, jumped into the rivers and saved the old man. When he came back to the banks, others asked him, if he was pure and how he could do this.
The young man said,” I am definitely not pure but I believe that river Ganges purifies sins when we dip.. The moment I jumped in Ganges, I was purified and hence qualified to rescue the Old man”.
Lord Shiva told Goddess Parvathi, “though every one knew that they get purified, very few have faith, and believe in that. And those are the ones who succeed. Therefore don’t worry. We will not have too much crowd at the heaven.”
There you see, it was simple but was difficult for many to follow.
Similarly every one can get rich. Making money is simple. You need to have faith in the advisor, the economy and the leadership of the country. But then, as in the previous example, many just don’t get to make it rich and wealthy.
Give money the time to compound and work for you
It is the time in the market that matters and not the timing.
You invest 500 a month and you could be a millionaire in 20 years.
But do you believe this?
Do you trust your advisor when he gives you options
Do you have faith that you can also be rich and wealthy.
It is lack of faith, bystander approach, prevents one from acquiring wealth.
With Faith you can also reach heaven. Jump in the Ganges. Start investing today
I can teach you how to jump but not drown.
Everyone wants to live long. To live long, apart from doing, yoga, exercises etc, one of the things we need is medicine. Though, Ayurveda, Homeopathy offer medicines in their own form, It is the allopathy or the medicines, that we have in consultation with our doctors, to get rid of their ills, which has bulk of its share.That is where the pharma companies, come into picture. These companies, do a lot of research, develop a drug, get the approval of authorities concerned and sell it to us. This is a big industry and the current global business is around 1.2 Trillion US dollars. ie close to 7 lac crore rupees.
The Indian market is estimated to be 36 billion USD. Of late we hear that the pharma sector is not doing well and the share prices have come down anywhere around 50 to 70% from their two year highs. Let us understand, what is happening in the industry.
Though it is a big subject by itself, I shall try to make it simple to understand. I call it as the MAGIC
Before we see the MAGIC in detail, basically the pharma and chemical companies do manufacture any one or more of the following categories.
a. GENERICS. When a drug is invented, normally the company that invents applies for a patent and the period of patent is valid for about 7 years. Till that period, no other company, can copy or produce that drug. After the expiry of the patent period, it is open and other companies can manufacture same or similar drug. The drug then moves into Generic category. Generic drugs are those drugs after the expiry of the patent period.
b. API – Active pharmaceutical Ingredient. is the main drug itself, where the active portion of the drug is present. Almost every pharmaceutical company is having API manufacturing.
c. CRAMS – Contract Research and Manufacturing Services, is an outsourcing activity where the company engaged does the work for another company in research or manufacturing. This is similar, to Foxcon making electronic components for mobile phones and assembly
d. Biosimilars. A biosimilar (also known as follow-on biologic or subsequent entry biologic) is a biologic medical product which is almost an identical copy of an original product that is manufactured by a different company. Companies like Biocon, Dr Reddys are investing heavily into this activity.
Having understood the basics, the Pharma sector has the MAGIC issues.
M- Margins. Majority of the sale of products come from Generics and there is heavy competition and there are also price regulations by the governments. Indian companies, with majority of sales in the US is struggling against competition and Pricing.
A- Approvals Any new drug, needs to be approved by the regulator and the major agency doing this is FDA or US FDA. US food and drug administration. A company has to make ANDA ie application for new drug approval and after getting that only, they can sell the drugs.
G- Geography. The market in which the pharma company present is also important and determines the sales, regulations approvals and margins. Currently majority of the sales is from US and Europe and US is the major market for Indian Pharma companies.
I – Inspection. Normally approvals and Inspections are a combination. However, Inspection is an ongoing activity. The regulators, check the manufacturing companies for quality, process compliance and data integrity. These inspections are periodical and based on the report, they can even prevent the companies from manufacturing till the noted issue is resolved to the regulators satisfaction.
C – Currency. Since the business is from different markets, the currency rate, fluctuations and they in turn affect the net profit of the companies. Un hedged forex can swing the margins.
Currently anyone or all of the above ILLS are plaguing the pharma industry. So what is there for us an investors?
Having mentioned about the sector, it is an industry where there is high entry barrier for competition and new companies to enter the sector. The skills required are also of high order and difficult to acquire easily. The companies are there for long haul and there are no fly by night operators. The quality of the management is very important.
a. Many companies are working hard to adhere to the compliance and overcoming any deficiency observed.
b. The data integrity and systems are improving.
c. The managements are committed and we have seen that some of the companies, who were issued observations like DR Reddys, Wockhardt, Divis Labs are already have got clearances.
d. This is an industry which is for long haul and This is suitable for those investors, who can with stand oscillating pressures .
Do choose the company and stay invested. If you cant chose the company, go for a pharma fund through the mutual fund route
Do contact me for any clarifications.
What are the forces at play while doing a bungee jump?
There are three main forces at play.
- The gravitational force, which pulls you down as you jump
- The force the spring provides which helps you from not falling and also enables you come up.
- The force or the resistance offered by air.
But for the air resistance, you can keep going up and down. But the air resistance, acts on the spring force and reduces your ascent back every time when finaly the fall and climb ends. The important thing is that when the gravitation force does positive. work the spring does negative work and when the spring does positive work gravitational force does negative work. All the time air resistance does negative work.This is akin to Your Portfolio appreciating or depreciating but inflation always does negative work and erodes the purchasing value. Your portfolio has to do super positive work to over come inflation and grow
click on the link, to read more about the force.This is classic conversion of potential energy to kinetic energy and back. But why we need to know this and what relevance it has got with investing?
Market is a place where people buy and sell goods or services. In stock market, people buy and sell shares or other instruments. There is difference in perception of the buyer and seller and hence exists a price difference. Like three forces exists, In a market there exist a buyer, a seller, and volatility.
Appreciation, depreciation, and inflation.What you buy may appreciate or depreciate in value depending upon the market forces
There are basically two energies on display.
The potential energy, the height from which the jump takes place and the kinetic energy which is either due to the gravity or the spring force. However the level of energy gets reduced for every movement due to the air resistance
Markets see that the stock prices or NAV of a fund, move up and down depending on the energies which is the momentum on selling side or purchasing side. And the air resistance is similar to inflation and does constantly erode growth in wealth.
See how some stocks have done bungee jump in the last one year and Who can do bungee jump?
Anybody can do a bungee jump.
In bungee jump, there is a trainer who guides you and helps you, take the jump and also land safely after you finish your jump.This is similar to an advisor, who guides you through the process of investing and enabling you to reach the goal or the destination. You get to experience the ups and downs and the resistance offered by air. You get to see the world with a different point of view.While staying the course of investing, in order to reach your goal, yet get to see all the risk, volatility, momentum and performance at play.
- Your behavior is controlled and you are disciplined during the jump. If you can exhibit a similar discipline and behavior in investing, you are sure the winner.
- Fortunately, you don’t get to hear any noise during the jump as you are isolated from the media. Avoid noise from the media while investing.
- More importantly, you have to indulge in the activity to gain and like wise, you have to invest to create wealth.
When to Jump ?
You cannot take to bungee jump, whenever you feel doing it. It depends upon the weather, the time of the day, availbility of the trainer etc. Follow the 5W 2h process in all activities you do What, why, where, who, when. How and the new one you add is ” How Much”?
I am your trainer and do contact me for the experience of a bungee jump in investing. Schedule a free introductory call with me on tlk.to/varadha