scorecardresearchR Janakiraman of Franklin Templeton's 2 crucial investing lessons that you should keep in mind

R Janakiraman of Franklin Templeton's 2 crucial investing lessons that you should keep in mind

Updated: 22 Nov 2022, 08:01 AM IST
TL;DR.
Working in the midcap space is surely not easy, but R Janakiraman of Franklin Templeton made it look not only effortless but also enticing.
An investor's decisions during volatile times have a large impact on his or her long-term returns, R Janakiraman says.

An investor's decisions during volatile times have a large impact on his or her long-term returns, R Janakiraman says.

When R Janakiraman talks, mid-cap investors listen.

Most investors are prone to overlooking long-term trends which, according to R Janakiraman of Franklin Templeton, can serve as a guidepost, allowing people to avoid costly mistakes during volatile times. An investor's decisions during volatile times have a large impact on his or her long-term returns, he once said.

Janakiraman, VP & Portfolio Manager, Emerging Markets Equity - India, Franklin Templeton, manages 15,000 crore which hints at his ability to identify the right midcap funds and use them to their full potential. His experience with Indian Syntans Invt Pvt Ltd, Citicorp Information Tech Ltd, UTI Securities Exchange Ltd in the equity research support function finetuned his mutual fund identification and management skills.

Here are two investing lessons from R Janakiraman that every investor should keep in mind:

Focus on winners alone 

The ability to let winners run for a long time and cut losers early is a critical characteristic for generating high returns, according to him. Identifying a good business to invest in is important. This is because long-term investments in growing businesses produce truly exceptional returns. The inverse is also true. Holding on to failing businesses for far too long can wreak havoc. Many people tend to hold on to stocks hoping for a turnaround. Opting for a “fail fast” strategy saves people from possible losses in the future.

Past need not dictate the future

Past investment lessons are not equivalent to scientific truths. This implies that the learnings from 2004 to 2007 may not have been applicable in 2015-20, and vice versa. Investors must be intellectually prepared to test a few different hypotheses for a given situation and be willing to discard a solution that may have worked in the past but does not appear to be effective in this case without abandoning a few core principles. Investing is both intellectually stimulating and financially rewarding for people willing to learn from their mistakes.

Article
Investors should check these ratios to assess the true worth of stocks. 
First Published: 22 Nov 2022, 08:01 AM IST