The Dhando Investor: The Low-Risk Value Method to High Returns by Mohnish Pabrai

The Dhando Investor is a book published by Mohnish Pabrai, an Indian-American value investor who is well known for his idea of ‘cloning’ the investment learnings from some of the investor greats. If ever there was an investor who personified learning from the mistakes of others then Pabrai would be it – he studied in great detail some the mistakes others had made. The word ‘dhando’ is a Gujarati word which Pabrai uses to describe the concept of downside protected bets – ie heads I win, tails I don’t lose much.  

Candidly, if you are familiar with the investment lessons of Warren Buffet and Charlie Munger, then what Pabrai has to say will sound very similar (not surprisingly given the abovementioned ‘cloning’). He writes this book with a focus on the Gujarati Patels – a group of Indian immigrants who started small by owning and operating a single motel in the United States, to now owning ~40% of all motels in the USA and building a ~$50bn+ empire. At the crux of this is value investing 101 principles and the ability to generate strong returns on capital then reinvest that capital into further strong returns.

From our perspective, perhaps the most important teaching we’ve learnt from Mohnish Pabrai is the reinforcement of learning from the investor greats – see what worked, what didn’t, see where other people went wrong and try to avoid those pitfalls. Learning from your own mistakes can be extraordinarily value but learning from the mistakes of others can potentially save you a lot of time and heartache. Keeping it simple and focusing on areas you understand can aid in this process. That notion can translate across numerous aspects of life, not just investing.

Link to Book

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