How did I build my Wealth? | Mitesh Khatri - Law of Attraction Coach

Today we are learning the difference between investments and trading to achieve financial freedom and to save for your future. Hi, those of you who don't know me, my name is Mitesh Khatri. I and my wife Indu Khatri, we are Law of Attraction coaches and national best-selling authors of this book, The Law of Attraction. Today I'm sharing about my investment strategies with you. I'm not an investments coach, I'm not even SEBI authorized, so don't take my advice as the key advice to make investments. I'm sharing this because a lot of people have been asking me questions. Mitesh, how do you invest your money? How do you make investments? Do you believe in trading? So this video is purely for educational purpose to help you from my experience. So I'm not going to tell you what you should do. I'm going to tell you what I do, and then you can take your decision based on my experience. Ready? Let's begin. So a lot of times I had this question, should I do investments? Should I do trading? I have two answers that I gave to myself for that. Trading— what kind of people should do trading? Firstly, people who should do trading are people who are very, very comfortable with risk, which means they're okay to lose money, they're okay to gain money, they're okay to go bankrupt also, they're okay to become rich also. Now if you ask me personally, do I like that kind of risk with my money? No, I don't like it. I don't like playing gambling with my money, so I don't want to do trading for that one reason. I'm not that kind of a person who wants that level of risk. That's one. The second reason I don't like trading is this, a very scientific reason which I believe is science. What is trading? Trading is investing money into a certain stock today, getting a very calculative analysis, thinking in a few days that stock will go up and then I will make profit on it. Some people do short trading, which means day trading. Uh, it can also be short trading in 5 to 10 days. Mid-time trading can be about 1 or 2 months. But all of this trading science is based on an assumption, and here is the assumption: The assumption is that you can analyze the market and you can time the market, which means what? I can analyze when a company stock goes up, you can analyze when a stock can go down and make money based on that timing. Now, I have personally understood by being with billionaires, and I'm not just saying this lightly, I have been in the corporate world for more than 17 years training and coaching large corporate companies and their board of directors and their CEOs and their CFOs. And these are billionaires whom I've personally interacted with, and they've all told me one thing which makes a lot of sense to me. They say that in the market, at any point of time, what takes the stock up and what takes the stock down is not one or two reasons. There can be thousands of reasons that can do that. They call this word variability. Variability means what? Variations. Variations means what? Many, many different things. So what can impact a stock going up? What can impact the stock going down? Thousands of things. They said a simple example. If let's say right now there's a war going on somewhere, oil prices go up. Why? Because suddenly a lot of oil is spent over there. So oil prices go up. When oil prices go up, the transportation goes up. When the transportation cost goes up, because of that, uh, the vegetables grow up. Because of that, many other fees of labor goes up. You see, it's a cascading effect. It affects everything in the market. But which thing is affecting what? How many variations are there? Suddenly there is pandemic. So many variations are there. If you're investing in Asian Paints, do you know that Asian Paints is procuring material from a particular vendor? If that vendor suddenly closes down, now another vendor will charge high to Asian Paints. Because of that, their profitability goes down, and because of that, their stock value can go down. Now, how do you know how many variations can there be for a market? Particular stock to go up and down. This is what very, very scientific investors say— people like Warren Buffett, by the way. And I'm quoting Warren Buffett. If you read his book called Buffettology, and if you read the books of many such great investors, they always say nobody in the world can time the market accurately because there are too many variations. I repeat, nobody in the world can time the market accurately because there are too many variations. So I watch this beautiful channel called Zee Business, and on Zee Business, I'm a fan of a particular gentleman called Anil Singh Vijay. He talks— he's an anchor on that show of Zee Business where he talks about stocks and portfolios. When he also talks, he says very clearly, nobody can time the market. In fact, scientific data reveals that more than 90% people who are in the trading business— what is trading again? I invest money today, Stock goes up and down. I make money with that. It can be short trading, day trading, mid-time trading. Doesn't really matter because you cannot measure the variations of the market because there are hundreds and thousands of reasons of variations. Nobody can time the market accurately. So they say that scientifically speaking, more than 90% people in trading lose money 90% of the time. I'm not kidding. Check this out on Google. More than 90% people who are traders lose money 90% of the times. So what is the winning ratio? 10%. So do I want to gamble with my money with only 10% chances of success? I don't want to. Now, if somebody wants to, that's their call. I don't want to. Have you heard this saying? Higher the risk, higher the gain. Have you heard about that? Do you agree with that? If you agree with that, raise your hands quickly. You agree with that? With the same hand, give yourself a tapu. If you read the book Buffettology, and if you read from investors in the world, they always say Don't take unnecessary risk with your money. Why? Your money is like your child. Will you take unnecessary risk for your child? Will you take your child and put him to a school where the risk of dying is very high, where the risk of abuse is very high, where the risk of racism is very high? There are too many variations of the child may succeed, the child may fail. Will you put your child over there where there is too many variations of success and failure? No, you will put your child in a particular school where the chances of success are what? Higher or lower? Higher, not lower, right? So why do you do the same with money? Why do you take risk with your money? Start treating your money like your child. Okay, example: don't expect somebody else to bring up your child properly. If it's your child, only you can do a great job giving your time, dedication, and love to your child. Same thing when you're investing your own money in the market. Don't just blindly trust in an investment manager. I don't do that because it's my child. How can I expect a bank manager or an investment manager to take up, take my money, multiply money by ten times in ten years because it's my money? No. Why will he do that? He doesn't have that level of emotional commitment for my money. He's just getting a salary, right? He's just getting a small percentage. So is he going to be emotionally committed to my money as much as I am? No. Time आने पे The way you will love your money, your investment manager cannot. Eventually they will sign a document from you. Investments is based on risk of your choice. If something happens to your money, we are not responsible. In the end of the day, you are responsible for— at the end of the day. So you have to sign that document, which means if the money loss happens because of your investment manager, they're not going to give that money return to you because you've already signed a document that says you are responsible for it. Makes sense. So if you're anyways responsible for it, अरे बाबा, you take responsibility. Now how do you take responsibility? Educate yourself. Start with this affirmation: I love money and I love learning about investments. Say it again: I love money and I love learning about investments. I love money and I love learning about investments. If you don't know the language of investments, how can you be a millionaire? If you don't know the language of love, how can you be happy in love? If you don't know the language of happiness, how can you be happy in happiness? To be a rich person, you must understand the language of money, and the language of money is investments to multiply money. Correct? I'll give you a little bit of education today based on my experience of how I invest in the market. Here is what I do with my money. I never invest as a trader. I invest as an investor. Here's what I mean by that. I don't look at money as a gamble. What is gamble? पैसा डाला Coming or going, आएगा या जाएगा, होगा या नहीं होगा, may happen, may not happen. Chances शायद ज़्यादा होंगे because you're looking at some data analytics, but you can never time the market. So for me, that is gambling. So what is investment? Investment is I know a company like, for an example, a very reputed company like Tata. I take the money, my money, and I invest in their stocks. But why do I call it investment, not trading? Here is why. Let's say I invest ₹10 lakh in Tata. Tata has multiple companies. I'm not going to name any specific company, but let's say I choose one group of company of Tata and I invest that money there. Now I will keep that money there for minimum 5 years, my choice, and I'll tell you why 5 years. Now Tata has a business idea or has a business strategy in that company. They will use this ₹10 lakhs for what? Uh, buying material, right? Paying salary to the employees. So the money that I'm paying, is it being of service to something in that company? Yes, the company is going to spend on material, on services, on products, on salaries. And then based on the hard work of all these employees and all the strategies that they've come up with, they sell something in the market to you and me. They give some product, they give some service. In return, they make the money and they make the profits. When they make the profits year after year after year, the company grows and they And their stock value grows, correct? But for a business to really, really show profitability, one year is not enough. You need to give a company minimum three to five years for it to give you really good benefits. Check the market. Go to any company, and if you go to a website like screener.in, which shows you the portfolio of a company, and if you look at the last one year, you will see huge spikes. Tak tak tak tak like this, like up and down. But if you look at any company in the last five years. You'll see a steady flow, especially good companies which are reputed companies like Tata. Now, why do I call them good companies? Here is why. When I make my investments, I have some criteria which I want to share with you. Criteria number 1, make long-term investments. Don't play gamble with your money. I don't play gamble with my money. Criteria number 2, when I invest my money, I look for a company whose owner's behaviors are stable and value-based. Example, do I want to invest money with a company who is growing rapidly? You will say yes. But what if I know the founder is a gambler? What if I know the founder drinks a lot? What if I know the founder is a partyholic all the time? Should I invest with this guy? I would not like to because his decision-making is always going to be driven by his behaviors, his habits. I don't want to invest with the company whose CEO is a drunk Partyholic, drug addict, and smokeaholic all the time, drinking daru all the time, only doing parties or parties all the time. I think you know whom I'm talking about. I don't want to take the name right now, but these companies eventually goes down because the decisions of these companies are made by unstable minds. I want to invest in a company whose mind is stable. Whose mind? The leader. Because eventually the decisions of the company is driven by the leaders of the company. So I always study that the company whom I'm investing with, who are the leaders of the company? Well, how do you know this? Research on them. भैया यहीं तो पैसा invest करने के पहले सोचना पड़ता है, काम करना पड़ता है। I do research on the companies that I invest with. I read about their owners, and it's very easy. Everything is available on the internet nowadays. Third very important criteria: the investor stocks in that company has to be minimum 48 to 55 percent minimum. Minimum. Why? Now, what is the investor stock? When a company goes public, there's something called investor stock, which means the founder stock. If I'm the founder of that company, let's say I am Ratan Tata ji. I like to say that example. So let's say if I am Ratan Tata ji and if I'm the owner of the company, should I have stock of my own company? Of course. If I don't have stock of my own companies, what does it mean? It means either I'm in problem, so I'm selling my stocks. Or I need money, so I'm selling those stocks. Now, I don't want a company which is into that kind of trouble. I want a company who believes in itself. How do I know that? Is the founder himself or herself invested in their own company? So if their stock value is anything between 48 to 55%, great, I want to work with that company. Makes sense? Now goes to the 4th criteria. What is the last 3 years of stable profitability of this company? What is the last 3 years of profitability of this company? Minimum 3 years I will look at it as a data, as a consistency. If I see that one year the profit has been very high but the other 2 years there's been losses, I would be aware before I invest into that company. And the last criteria that I look at is, is the company cash rich or debts are going on? What does it mean by cash rich versus debts? Cash rich means the company has a lot of money To pay for the salaries, to pay for the expenses, to pay for the infrastructure, to pay for the goods and services that they buy and sell. If a company is under debts all the time, what does it mean? Here is what it means. Let's say their expenditure every month is 100 crores. I'm using the word 100 crores because we're investing in public limited companies. These are large corporations. So if their monthly expenditure, let's say, is 100 crore because it's a $2 billion company, just as an example, then their minimum cash which should be 110 to 120 crores, that amount of money should always be with them. But if they are under debts of 600 crores and they have barely any money to pay off their monthly expenses, now that's a problem, right? Why is that a problem? One, because they are in debts and their expenses are too many, so that impacts their stock value. Second, because if there is a pandemic, if there is any bad situation in the market, so many variables are there. Because of the war going on in Russia, something happens in India and Indian market gets impacted. Something happens in the US elections, Indian market gets impacted. When that happens, which company will survive? A cash-rich company or a company which is heavily under debts? Cash-rich company will survive. Do I want my money to survive? Yes. So I want the company to survive. This is how I look at 5 criteria when I invest my own money. But here is my invitation to you. Start learning. Learn how to make investments. Learn how to understand the language of money. Learn how to save money on a regular basis. Mutual funds, debt funds— these are great investments to start with, but if you don't understand how to invest with them, how will you be able to multiply your money? I have a very good friend of mine. His name is Modit sir. Modit sir teaches people how to very safely, understanding long-term perspective, invest money for long term rather than short day trading. He teaches people how to have lifetime savings, not just short-term gains for gambling. If you're interested in that, I'm going to give you the link to his course in the description below. Click on it, go to his webinar, watch how comfortably he teaches. What I love about Mudit sir is very calm, very, very careful with his own money Very careful with what he teaches to people. I remember one day in my community, somebody had invested some money in stocks, made a lot of money as a trader. In about three months, he got a fifty percent increment of his money, so he was very happy. So he he shared that story with everybody because we are in a community; we are all friends. So I went and told Mudith, "Are Mudith, you know there is this guy? He made fifty percent money extra in just three months. That's amazing, yeah? Isn't that amazing? How did he? How do you think he did that?" And Modit sir said, "Tesh, this is a risk. Don't follow these people because today when they made fifty percent three three months, they went they would go and tell the whole world. But this also means he's a risk taker. If he's a risk taker, he's going to take risk again tomorrow, and the chances are ninety percent of the time he's going to lose. But when he loses money, he will never come and tell you he lost the money." I said, "Ha, that makes sense." He said, "When was the last time the same guy came and told you that I invested and in one month all my money went down?" Or my money went down by 50%. Did anybody tell you that? I said no. He said, so always remember, people will never tell you their bad decisions, but people will tell you their lucky decisions. Exactly, lucky decisions. Because 10% is luck, 90% is the data consistency of failure. Why go on the 90% failure and 10% luck? Invest in long term, says Mudit sir. Makes sense. But these are some of the things I've learned from Mudit personally. I love learning from him. And I've made decisions based on that. Why did I make this video today? I want to invite more of you to learn about investments. Stop gambling with your money, please. I hear so many stories about people who say, sir, I saw this video, 22-year-old boy made 500 crores from trading, and he's showing so many screens are there in front of him, and he's driving a Mercedes today. True, but he will never not post videos when he's lost all that money. It's easy to make this money sometimes in 10% luck because the luck is on your side. But remember, luck is luck, it's not science. 90% of variability is still there. Please don't gamble with your hard-earned money. That is why I'm making this video. I hope this message reaches you. If you know somebody who's gambling with their money, if you know somebody who's burning their hard-earned money, guys, we make 1 lakh a month, 2 lakhs a month by working hard from 9 o'clock in the morning till 8 o'clock in the evening. पूरा दिन काम करते हैं, मेहनत करते हैं, जब जाके सैलरी मिलती है। और फिर इसी सैलरी से घर भी चलाना है, इसी सैलरी से बच्चों की स्कूल की पढ़ाई भी करानी है, इसी सैलरी से हमको सेविंग भी करनी है, जब कोई बीमार होता है तो उसको हॉस्पिटल भी लेके जाना है। We have to do so many expenses. You cannot afford to take all that risk with your salary. This is your hard earned money. Even if you are in a business, so what? You may be making five lakhs monthly profit, but it's your hard Earned money. Don't gamble with your money. Make smart investments. Learn about investments. Don't get carried away by these examples in the market that people talk about. तीन महीने में वो करोड़पति हो गया। क्रिप्टो में इतना पैसा डाल दिया करोड़पति हो गया। Be careful. Be smart. Be safe. Always ask yourself this question: If this money was my child, would I take this decision? And if your answer is no, that you wouldn't take your child and invest it over here, then don't make that decision. I'll see you soon in the next video. I hope this video inspires you to save your money, to multiply your money in a beautiful long-term investments way. Okay, thank you very much. Subscribe to the channel, hit the bell icon so you get a notification the next time I create an amazing video like this. See you, bye-bye.