Friday, December 16, 2016

You can be Rich - Invest Smartly!

P.V. Subramanyam
“Investment” is a word that challenges the intellect of every investor, followed with the prolonged and topsy-turvy discussions with almost everyone he knows. Suddenly, everyone around him dons the hat of a financial advisor, offers guidance that confounds him totally and this creates even more baffling situation for a naive investor. Contrarily, the answer that he seeks, paves the path for myriad other questions. At the end, he feels himself being trapped in the cobweb of financial planning and investment.

This led to the increasing demand of trusted and experienced advisors. Hence, with the aim of solving this problem of thousands and saving the amount in millions, the two financial bloggers, P.V.Subramanyam (Author) and M.Pattabiraman (Co-author) teamed up to pen down the most effective and compelling investing essentials and calculators, in their jargon-free book 'You can be Rich with Goal Based Investing', that a novice investor can easily comprehend.

P.V. Subramanyam is a Chartered Accountant by profession and has conducted over 50 training sessions on ‘Finance for Non Finance companies’ for major industries that include mutual funds, life insurance companies, private sector banks and brokerage houses. M. Pattabiraman is an Associate Professor & Researcher at IIT-M and has also won Young Faculty Recognition Award.

1. You are in the finance industry since three decades. Please share with us your experience and the thing about the Indian financial sector that amuses you the most.

P.V. Subramanyam: Been a good ride, God has been kind. I have donned the role of an investor, sub-broker, fund manager, broker-advisor, and now blogger, investor, and financial coach. Each role that I did in the past has been a good step. However when I did CA, got trained as a lawyer, did company secretarial work- I had no clue that each step will add so much value. Like I said God has been kind. I do think, I have a special skill to be lucky.

People happily make mistake of buying inefficient and expensive products for millions, BUT refusing to spend even in '000s for financial education. However, this is true in many fields. People spend Rs. 75000 on a camera but will not spend Rs. 7500 for one day workshop by a good photographer to learn how the camera works.

2. Being deeply involved in physics and quantum research, what inspired you to become a financial blogger?

M. Pattabiraman
M.Pattabiraman: Personal circumstances. I was a head-in-the-clouds academic but was forced to think about money when my later father suddenly fell sick. Low-level of risk perception among both buyers and sellers. Perhaps not an amusing matter!

3. What was the motivating factor and the most challenging thing that you both came across, while writing this book?

P.V. Subramanyam: Motivating factor- The ONLY way to INVEST is being GOAL ORIENTED while investing. The biggest FAILURE of investing is when the investment is UNABLE to meet
the GOALS for which one is investing. So, my co-author Pattu and I were convinced that knowing where a person is, where he wants to grow, what instruments he can use, what route, what kind of risks lie in the path can be made into a small, simple book. Pattu came in as the Calculator king to create

The challenge was to simplify it to basic English and dejargonise so that a layman would not be intimidated by the content. The feedback so far is that we have reasonably achieved this.

M.Pattabiraman: The book is essentially Subra’s vision: Invest with a goal by asking the right questions and seek simple solutions. The common problem among investing books is the gap between thought and action. There are problems when the reader tries to implement what is written. The calculators associated with the book will reduce this gap since the reader can now create personalised investment solutions.

The only challenge was to convert Excel sheets into online tools. However, the publishing team took this burden off my shoulder and handled this efficiently.

4. When two people write together, there is a lot of learning process that one undergoes. What did you learn from your co-author?

P.V. Subramanyam: My learning from Pattu was actually over long ago- in fact long before we started this project. I could spell out a need and Pattu could use his Excel skills to convert that into a calculator in a jiffy. Once I knew he had that skill, I did not want to learn it. It was much easier to ask him for a calculator instead of trying to learn what he was doing. In a time of specialisation, re-inventing the wheel made no sense.

M.Pattabiraman: I have been learning from Subra for many years now. The seeds for this book were sown when he reviewed my first calculators 4-5 years ago. His investing experience has resulted in an intuitive perception of risk and reward which is quite unique. This is great food for thought to create simple tools that anybody can use to illustrate and understand his ideas.

5. The book basically deals with the investing techniques that one should follow. Do you both also practice these techniques?

P.V.Subramanyam: A lot of it yes. For e.g. I would know which of my investments are earmarked for what- and which asset is the fall back option if the main investment was to fall short.

M.Pattabiraman: Yes, to a tee.

6. It's a typical Indian habit to compare things. So, according to you, how Indian investing pattern differs from the Western culture and what effect it creates on our economy?

P.V.Subramanyam: It takes much longer time to do a due diligence with Indian companies. Overall there is no 'Indian investing pattern', at least I am not able to spot it.

M.Pattabiraman: It is human to compare. In general, I think everyone has similar ideas of risk and reward.

7. There is a common belief among the investors that 'Investing is the easiest way to double up the money' and with this perception many people get attracted towards investing, who later end up making huge losses. What advice would you like to give them about investing?

P.V.Subramanyam: Doubling, Trebling, etc. sound good. However, while investing one needs patience. Investment in good quality companies have given 100 times earnings over say 20 years, why should you be happy with a mere doubling?

M.Pattabiraman: Watch a video on how Bamboo plants grow. Nothing happens for years, followed by spectacular growth. Money grows in a similar way for those who patiently invest.