Wednesday, 6 March 2013

The Most Important Thing: Learning from Buffett & Sachin

Ahh... what a catchy headline, you would say !!!
What's common between Buffett & Sachin & what is the most important thing that can be derived from that similarity, some others would wonder!!!

So, let me try to answer this. But first a few questions-

Who is the World's Best Batsman?
All sort of people will have different answers but most will say Sachin is the best.

The next question is for only those who say Sachin-
Why? His average is not the highest, his highest score is also not the highest in the world, his lowest score is also not the lowest either. So why Sachin?

Before you answer, here is another one-

Who is the World's best Investor?
There would be some arguments on this one also, but lesser than Sachin. Mostly will say Buffett.

The next question is for only those who say Buffett-
Why? His CAGR average (19.7% CAGR) is not the highest, his annual highest (59.3% in 1976) is also not the highest in the world {Even yours truly boasts of a better highest annual score than the world's best investor :-)}, his lowest annual (-9.6% in 2008) is also not the lowest either. So why Buffett?

The answer is because Sachin has the Highest runs, Max centuries, Max MOM.
And Buffett has the maximum growth of capital (some 586817%).

So, the common reason to both the WHY is Longevity; Durability; Time in the Game. If you haven't spend enough time in the game, you can't be Great. You may be a possible great, but to be a proven great you need to have decades of experience.

So, there can be neither 20 years old Sachin nor 20 years old Buffett.

And so this is the most important thing- The Longevity, The Time in the Game.

Also, you should be Good to succeed. Look at Sachin's technique & Buffett's process.
Too much of a good thing can be wonderful & too much of a bad thing can be disastrous.

So do a lot of something but do it WELL.
*******************************************************************************
Now a tough one- If you have to choose between being Sachin or Buffett, what would you pick?

Before answering, look at Sachin. Poor guy has been slightly out of form recently & had to retire because of that.
Now look at Buffett. He has underperformed S&P 3 times in last 4 years (This has happened only 9 times in 48 years). For the first time, he is expected to give a 5-year underperformance to S&P.
Still Nobody is asking for his Retirement!!!

So my vote goes to Buffett. What's your choice?


 

12 comments:

  1. Brilliant is a gross understatement for this article. Truly loved it :)

    Keep up the good work.

    ReplyDelete
  2. Thanks Subash.
    Also would like to thank you for your Mental model blog. Really good.

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  3. I would rate Sir Don Bradman as the world's best batsman. Sir John Templeton, in my view, is the world's best investor.

    ReplyDelete
    Replies
    1. Sorry for the post then. I hurt your feelings :)

      Delete
  4. If Buffett is Sachin, who is Charlie?

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    Replies
    1. This comment has been removed by the author.

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    2. Charlie is Twice Dravid then...
      Not popular, just like Dravid.. but great.
      And Longevity is about 2 times , so Twice. :-)

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    3. Ah! Thankfully Charlie is not Kambli! ;)

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