Posted by Sreekant on 19-01-2012.

It’s been quite a while since I wrote a blog post. Well, I was caught in the “Thane” cyclone and life was dislocated for a while. I was however lucky than most others in this area as my suffering and damage was much lesser than what I witnessed around me. My heart goes out to the families affected by this very severe cyclonic storm and yes, I have done my bit to alleviate their suffering. People have lost their roofs, cash crops, cattle etc.

My recent experience made me write this post. Good and bad news awaited me in the aftermath of “Thane”. The bad news was that there was some damage to my properties which would cost a fairly large amount to restore. But the good news was that I was not needed to pay for the repairs and renewals from my pocket! Yes, some of the teak trees that my father / grandfather had planted more than two decades ago were uprooted by the storm and they had to be cleared and sold. Even the partly damaged teak fetched a sizable amount and that too in the present depressed market (millions of trees have fallen in this area and all of them are hitting the market), sufficient to repair the damaged property and hopefully leave a surplus too. Well these trees were fully in my sight all these years but did not attract my attention for any reason. They were planted and cared for initially after which they needed no further care or attention. They grew by themselves and provided me a lump sum after so many years.

I am also reminded of an anecdote that I had heard a few years back. An elderly marwari gentleman passed away leaving a lot of incomplete financial transactions. When the family set about closing those transactions, they were faced with a huge deficit. Obviously some of the receivables were not properly recorded by the elderly man and those who owed money kept quiet conveniently. The family was crestfallen as their family dignity and future life were at stake. After some time, thought and much hesitation, they decided to sell their house to settle the pending transactions. While they were disposing off the unwanted articles, a steel trunk that had been lying abandoned and uncared in a corner of the house needed to be disposed. When they broke it open, they were greatly surprised, in fact pleasantly shocked to find a few thousand shares of Infosys in physical form bought at the time of the IPO!! You can well guess how those shares would’ve helped the family at their time of crisis.

The similarities between my recent experience and that of the marwari family seem striking. A wise action / investment made many years ago and left undisturbed has grown tremendously over the years and made a perceptible impact on the owners. Well that is the power of equities and they are like the teak trees that grow into a fortune over time. If those trees are disturbed every now and then or are cut prematurely to realize the profit, their true potential is wasted. A good equity (shares) investment held for a few decades could well change the financial fortunes of the investor and his future generations. All that it requires is patience and conviction. If you are going to doubt continuously whether the teak would in fact grow into a giant, then there is every possibility that you would disturb / destroy it.

It is in the Indian culture and ethos that we look to leave a fortune to our future generations, even if it meant sacrificing a bit of our lifestyle. The simplest way that you can achieve this fortune is by buying shares of good companies (of course at the right price) or units of good diversified mutual funds and leaving it undisturbed for decades, possibly away from your and your family members’ view. You can rest assured that they would come handy to your loved ones at times that are good or bad.

And yes, if you have the space and inclination, do plant a few teak trees and care for them in the first few years. They will surely add to the wealth of your future generations without much further effort!

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