The Dhandho Investor by Mohnish Pabrai

Mohnish Pabrai shares a great framework: Heads you win and tails you don’t lose much.

Every Investment involves degrees of RISK, so the idea is to invest when the odds are HEAVILY IN YOUR FAVOUR.

Dana White wins $7 million on Black Jack and gets banned!

Now Dana White is crazy good with the BlackJack card game. The odds are in his favor at every table he sits at unless the casino changes the BlackJack rules.

Using the framework “Heads, you win and tails, you don’t lose much,” what is a game you can play that you have high odds of winning?

Everyone has one superpower; it could be you are great with numbers, people skills, or work ethic, among others.

Even though this book is about Value investing, it made me realize that using the above framework. You can win in life by playing the game; you have an UNFAIR ADVANTAGE.

The book title Dhandho (pronounced dhun-doe) is a Gujurati word that means doing business. If we break it down, the literal meaning of dhandho, Dhan means funds or wealth, and dho means to wash.

Yes, I know the literal meaning does not make sense. Let’s keep it simple Dhandho means doing business

Dhandho Investor means an investor who takes LESS RISK but GAINS HIGH REWARDS.

For example, Richard Brandson took very little risk by not investing a huge investment to launch Virgin Atlantic.

Sir Richard Branson called the airline company to hire airbus and TESTED HIS IDEA instead of putting much of his wealth into the business before launching the business.

2) You Follow Your Role Model

It is interesting to see certain ethnic groups in one particular trade, like most Sikhs doing taxi service jobs in New York (before Uber).

.. Vitmanise people working in a beauty parlor.

Why could this be?

Because subconsciously tend to follow role models who became successful in that trade.

The role model had some success making good money in the trade once they immigrated to the western country and followed their success blueprint from people of their similar ethnic group.

This book made me realize the opportunities in life where I could take a minimal risk with high rewards, and I will be sure to do more research into Value Investing inspired by this book.

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