As the CIO of HSBC Mutual Fund, Tushar Pradhan is responsible for all investment activities and investment strategy. In an exclusive interview with Cafemutual, he talks about his first investment and shares with us many interesting insights of his life
What is the most exciting thing about your job?
Professional golfers are a rare breed. While all golfers I know are passionate about the game, only professional golfers get paid for doing it. This in a nutshell is what I find exciting about my job. While a lot of people are passionate about investing, I like the fact that I also get paid to do it.
Tell us what it feels to be responsible for managing other people’s money.
While being responsible for managing other people’s money can unnerve many, I believe that if one does the job well, diligently and to the best of one’s ability in a professional manner, it is not much different from a pilot flying a plane or a surgeon operating on a patient. While mistakes in other professions can lead to loss of limb and life, in our case it can lead to major financial loss for the client and a great damage to one’s own ego. However, I have derived enormous satisfaction over the past years managing other people’s money.
Did you always want to manage money? If not a fund manager, you would have been
Yes, for as long as I can remember. If not a fund manager, I would have been a teacher.
Tell us about your first investment.
The first time I got close to investing in a stock was in my college days when Orkay Mills created a buzz with its IPO. I remember coaxing my dad to buy it (he didn’t) and I remember that it made some serious post listing gains at that time. The first stock I bought in my name was HDFC Bank and same was given to me as a stock grant by my then employer. God bless them! Needless to say, it did well! The first lesson I learnt from these initial investments is that luck has a lot to do with success in stock investing.
My real interest in investing in the stock market began during my MBA program in the US when I met a wonderful human being, my professor at the Barney School of Business and Public Administration at the University of Hartford, Conn., Richard A. Cohn. His startling advice to all of us at the beginning of the course was that if the course did not add to our knowledge in any way, he would try and ensure that he gave us enough of an understanding to at least pay for the course by making some money in stocks. I have been hooked on since then.
What role does luck play in investing?
Was Isaac Newton lucky? Was the apple falling on his head the real reason to have discovered gravity? I think an obsession with the stock markets, combined with a good basic understanding about company fundamentals and a more than cursory knowledge of human irrationality combined with a huge dose of luck plays an immense role in investing.
What are the qualities that you feel a good Fund Manager should have?
Patience, humility and perseverance. Analytical ability and a basic knowledge of accounting and economics I assume to be a given.
Share with us the best advice you have ever received.
Read and enjoy; Do and become!
If you were allowed to spend a day with someone from the world of investments/business of your choice who would give you wisdom and perspective, who would it be?
I would love to spend a day with Robert Merton, Nobel Laureate, Professor Emeritus at the Sloan Business School at MIT and Distinguished Professor at Harvard. Prof. Merton would be a serious source for gyan since he is an authority on valuation of derivative instruments, a subject of interest for me (he got the Nobel for it) but interestingly also one of the earliest authors on what is now known as modern portfolio theory. In addition to being a staunch academician, he is also an early behaviorist and one that my old professor at Hartford looked up to, even if he was several years his junior (they were together at MIT). It is my misfortune to have never met him and would look forward to meeting him if only for a day.
Your favorite book
The Bhagavat Gita. I think the essence of all knowledge lies in this poem hidden in the epic, the Mahabharata. Classics are books that remain ever fresh in the minds of people, a book that means different things to different people at different times. I have read the book several times, the same sentences over and over again, and yet each time it has the potential for me to discover a new meaning. The various layers of meanings unfold as one dives deep in to the text.
How do you unwind?
I try to not to get wound up in the first place!
Over the next 10 years, the most exciting country to invest in would be
India
Advice for budding fund managers.
Have patience, be humble and remain perseverant.
