Wednesday, February 20, 2013

Journey from Peanuts to Millions

        It’s been always told to us that money making is not easy. We also know it for a fact, that yes, it’s not. It takes a lot of hard work to become richer and for sustaining the Wealth created.

I would like to tell you about someone who actually made money easily, without even knowing much about what exactly was going on, but kept patience with discipline and got paid off.

It’s a story about a common man with an extra-ordinary investment experience.

Long time back in the year 1999 a small farmer who knew nothing about stock market himself and was a total layman and least bothered about any Stock Exchanges. But he had a friend who was involved in Equity Investment, in fact was a wise stock broker (rare species today).

One day the friend on a cup of tea advised him for investing into Equity for long term. The farmer being a novice and also not cash rich couldn’t understand that what he’s supposed to do?

The friend soon realizing it, advised him to just invest Rupees 5000 per quarter in Aban Loyd till as long as it’s possible. He asked him to assume it as lifelong a “lottery” and you should continue buying it every quarter for the decades to come.

This fellow guy didn’t understand anything much rather than the word “lottery”, neither he knew what exactly Aban Loyd is into, but he believed his friend and soon got fixed with a stock broker to do the needful.

Between the years 1999-2003, Aban was actually in a price range of Rs 5 and Rs 240 on the upper side. During 1999-2003 the Investor accumulated a lot of its shares on a quarterly basis when the prices stayed low between the mentioned above ranges. Year 2004 onwards it has moved one way up.

In 10 years total investment done is Rupees 2 lakhs. And can you guess his today’s portfolio Value??

He got somewhere around 10,000+ shares of Aban today and going by the current market price, it’s a whopping 80 lakhs!!!

Before the crash in 2008 the valuation was as much as around 4 crore’s!

Let’s not talk about the dividends he got all this years, because Aban didn’t give any, but then why should he care! He’s still investing the same amount every quarter. He said he never knew if this was going to happen. He didn’t use to keep price neither anything else in check; he was too focused and disciplined doing what he was asked too.

Even being rich today, he enjoys the same life style as earlier by taking care of his farming land and still invest 5k per quarter in Aban and is expected to do so whole his life.

Moral of the story:-

At times extra knowledge and doubts becomes our enemy, when there are too many questions going in the back of our mind, we intend to take wrong decisions.

We keep asking, finding, and searching the world inside out doing Google, doing Yahoo to know those things which are not required to know for simple and smart investments.

Sometimes being a layman actually works in a great way, something like this farmer guy. SIP is the “basic and dumbest way for Wealth creation”, now you also know that actually it is.


  1. Thats a good story and good lesson.
    Thats the power of SIP and value investment.

    1. ys dude...SIP is always powerful tool for investments