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You must have been shocked that who would do SIP of more than 40 lakh rupees every month. That is why the story of Gajendra Kothari is interesting and every mutual fund can show the right path to the investor. Gajendra Kothari wants that when he is 65 years old, his portfolio is worth about Rs 3,000 crore. Kothari is today founder of Etica Wealth Capital, but the beginning was completely normal.
50 lakhs lost in F&O trading
Then he got a chance to work in London. His income increased manifold by going to London. But after this he made the biggest mistake of his life. He blew his two years of savings in F&O (Futures and Options) trading. There were market crashes around the world of 2008. During this time, he got caught in a trap in day-trading and leveraging and lost 50 lakh rupees. At that time it was a big amount. This disadvantage shook them so much, they started staying away from the market. But learned from this loss. He learned that disciplined investment is necessary instead of betting.
Gajendra Kothari said in an interview, “This was the cheapest lesson in my life, for which he had to pay a fee of 50 lakhs.” This experience inspired him to start his firm. While working in UTI, he used to advise High Networth Individuals (HNIS). They realized that they could explain to people in simple language. In 2009, when the industry was considered a “game over” after SEBI’s entry load ban, Gajendra launched ETICA Wealth.
SIP starts: small amount, big dream
Gajendra says, “This is the first SIP of my life, and will never touch it. It will be the longest period and will teach the most.” This is an example of SIP compounding. His first Rs 5,000 installation is 55 to 60 thousand rupees today. About 11-12 times. He says, “Imagine, every institution will reach 7 lakhs in 30 years. More than 140 times!”
Sip from 10,000 to 41 lakhs
Gajendra gradually increased the SIP. Started Rs 10,000, then Rs 50,000, 1 lakh and by 2020, they were doing 6-7 lakh monthly sip. Today they are doing 41 lakh 20 thousand rupees a month. About 5 crore rupees of the year. But where did the money come from? Actually, Gajendra Kothari has earned money from his job or business and has put it in SIP. Earning money by doing jobs is called active income.
Kinta is now Gajendra Kothari’s portfolio
What is Gajendra Kothari’s investment strategy
His investment strategy is opposite. Insert money into poor performance sectors (eg 2020 PSU or China Tech). Put 20 lakhs on a 50% decline in China Tech, then 45% and 40 lakhs on fall. Today his CAGR is about 23 percent.
Gajendra’s visit was not easy. The 2008 crash took away everything, but it learned that the markets are cyclicals. Meaning it is its job to go up and down. Return is made only by instability. The return in Covid had fallen by 7 percent, but has been patience and has become amazing today. He says, “The market gives you the returns that you do. But it is necessary to be in discipline.” His goal is to make a portfolio of 3,000 crores for 65 years. He says that “this is a mathematical game. The process should not be interrupted.”
Tips for common investors
- Short start: Start at 10,000, but not stop it.
- Automation: Do not apply mind, let SIP run.
- Patience: Do not stop investing in crash also. If you have become a bottom, then add more money.
- Active Income: First increase income, then investment.
- Tax: Keep long-term, save tax.
- Portfolio: Do not take more than 5-6 funds.
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