Terms that measure risks of your investments. #personalfinance #investing

Category – money and business

Reading time – 2 minutes

When ever you invest your hard earned money or even inherited money or any money for that matter, there is always some risk.

It may decrease or even evaporate or atleast returns may be lower than expected.

Inflation may kill returns or taxes may eat it away.

Covid like uncertainty might hit your money.

Than what to do. There is not much that can be predicted by human beings. They may claim credit for random guesses but future is not open for speculations.

So, you may use surrogate markers of risk and calm your nerves a bit into thin blanket of mathematics.

Here are three terms you may hear accidentally from financial experts.

1. Standard deviation – This shows amount of expected volatility.

It shows amount of fluctuations possible in an investment from mean value. More standard deviation indicates wide fluctuations are possible,so keep your belts tight.

2. Beta – Risk of your investments in comparison to the market as a whole.

It compares investment to market index like nifty or sensex.

Beta 1 means investment will move in sync with standard index. Higher the beta, more volatility is expected.

3. Alpha – It is extra earnings in percentage of an investment in comparison to a benchmark index.

For example if sensex returns 10% Durning a period and your investments return 12%. Hence your alfa is 2% ( 12-10).

So next time you read this words in a newspaper or blog then you would know what these mean.

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Inspiration – Financial blogs

Is your lifetime quota of heartbeats fixed ? kleiber,s law #innovations

Category – Science

Reading time – 2 minutes

Max kleiber was a Swiss scientist.

He researched on agricultural plants and animals. He wanted to find, effect of body size on metabolic rate of the organisms, a thing that was useful in cattle industry.

Cattle industry owners saw potential in his research, as he could predict how fat their cattle will grow and how much bounty they can get by serving them to carnivorous masses.

Working over this, he stumbled upon a pattern, which is called kleiber law.

He noticed that as organisms grow in size, they slow down.

A rat has faster beating heart; as compared to an elephant. A bull’s heart beats slower than a cat, when he munches his grass.

He applied his mathematics knowledge, to analyse it and he found that it follows, “negative quarter power scaling.”

That means something; that blasts mind of every guy, who didn’t like maths at the school.

But, we can only know that if we take mass of an organism and do its square root and do square root of result obtained again; we will get approximate idea of its metabolism. Metabolism is 3/4 th power of its mass.

That means we do sqaure root twice.

By these ratios, we can predict relative metabolism of two animal species.

For example, if we take a cow and a rat. Let’s assume if cow is x times heavier than it; then cow’s heart will beat x times slower than rat and it will live roughly x times longer.

Scientist Geoffrey west took it further, when he applied this law to non living things like cities, creativity and ideas.

It applied well to cities when we saw cable length, petrol stations, factories etc.

But when he applied it to Idea generation and innovation it was not applicable.

As size of cities increased, number of ideas generated increased exponentially.

That is why cities serve as centres of growth and innovation.

As different ideas collide; they generates new combinations.

Hence, although kleiber’s law can help in comparison of heart rates and life-span of different species, it doesn’t apply everywhere as a basic law of energy distribution in nature.

Let’s stop here. I don’t see too many fans of mathematics, who scroll on social media.

Inspiration – Where the good ideas come from Steven Johnson.

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10/10 law #innovation #newtech #economic science

Category – Technology and science

Reading time – 5 minutes

Slow path of acceptance

We humans are slow. We have infinite inertia. We would lie on the spot; if somebody put food plate on our belly and switched on the television.

We hardly like to change.

When scientists make a new discovery, they jump in their trousers and envision world changing due to their discovery.

But with time, they see ignorant human beings around them, munching on their oily burgers.

How they can’t see the revolution.

Scientists grow old, their skin wrinkles, eyes give away in the hope of seeing their discovery reach the masses and few even go away into oblivion, before people realise that some great thing is here.

It applies to all the technologies. Generally a technology is slow to be adapted by massess.

It takes generally 10 years to build a new platform or idea and another 10 years to its reach into mass audience.

For example first colour tv broadcast was done in 1954, but it reached prime time in 1965.

HDTV took 10 years to reach from first signal to mass audience.

AM radio took 10 years to reach masses.

But this speed was speed of the 20 th century.

Now, technology progress seems to be speeding up. Facebook, YouTube, wtsapp took lesser time to reach masses.

So did instagram and paytm.

So did phonepe, Zomato and grocers.

As technology and it’s adoption rate are both speeding up; it remains a mystery that when will this speed stabalise or we are going to be more and more entropic race.

Inspiration – The design of everyday things by Don Norman

#technology #science #evolution

Nirma story #succes #nirma #business

Category – Business

Reading time – 2 minutes

Mr Karda bhai patel worked as chemist in office of Gujrat government in west Indian corner.

He was stuck with an idea to manufacture detergent powder in his backyard and he started selling it in his area.

He did this after his office hours.

He used low pricing to attract cost conscious Indian customers.

People liked it for its quality and low cost. Encouragement led to resignation from job. He set up his small workshop in Ahemdabad.

He slowly captured market in Gujarat and Maharashtra. Then he spread all over the country.

Today Nirma group is a mammoth working in diverse areas like medicines, soaps, detergents, salts and lab products.

Everything starts small.

Everything takes time.

Everything needs to expand, adapt and change with time.

Everything like this is inspirational.

#business #growth #enterpraneur

All growth and innovation happen here – The adjacent possible. #ideas #innovation

Category – business and money

Reading time – 5 minutes

Adjacent possible was coined by scientist Stuart Kaufman.

It includes all the things possible; just next to what we have already achieved in a technology or idea.

For example man picked up stones to break nuts. Next possible change it saw was that heavy stones work better.

Then man found that sharp stones work better. Then, stones that fit between thumb and finger work better.

Then, man found that stones tied to a stick produce greater force.

Then, he found metals and made tools with metals. Then, he inserted batteries in tools like drills.

Each discovery led to next possible discovery.

And exploring next possible thing slowly, man reached present time of nuclear weapons, with which he can terminate his eternal stupidity and greed.

So one development in a technology opens doir to next possible improvement or addition, which is a slow process happening by contribution of multiple brains.

Adjacent possible is next possible improvement in present idea or technology.

It is not infinite.

It presents infinite possibilities out of which few are useful or meaningful.

It is slow and continuous.

Its boundaries grow as new possibilities are added or arise.

It applies to living beings and non-living things too.

Initially computers were text only medium. Then possibilities kept adding on to it and now you can post your photo or thoughts at the flick of your thumb, which similar sapiens all over the globe can see.

Hence, whenever you work with your ideas keep an eye on what is the next possible valuable addition to this idea.

That’s where next big thing resides.

Also keep searching your adjacent possible. You were not same in the past and you will also change in future. Keep jumping into adjacent possible of yourself and keep improving like all technologies do with time.

Inspiration – Where good Ideas come from.

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Communism is must for capitalism survival! #communism #capitalism

Category – business and money

Reading time – 5 minutes

Right from the time, when we wriggled out of the sea water and started infiltrating all over this planet; we always needed fiction to survive.

We needed myths like Gods, states and religion.

Man needed stories to stick to. We needed groups to be part of and we needed feeling of, “us and them” to feel purpose in our life.

Then ideologies corrupted our minds. Some followed communism; which raised right questions but provided few solutions.

Few followed capitalism; that solved many problems but gave birth to extreme inequality and ecological disturbance.

Communism still holds firm in many countries; especially in Eastern parts of the globe.

Communism is basically,” from each according to his ability and to each according to his needs.”

In this all property is owned by the community and each person contributes and receives according to his ability and needs.

Communism is still deeply ingrained inside every inch of capitalism and we don’t even observe it.

It is necessary for capitalism to flourish and spread.

In the house joint family members share their possessions with each other. They earn them by capitlistic market and then put to use based on communist principles.

When we get out of house; we ask strangers for directions free of cost. We may get shelter under strangers umbrella. Somebody may tell you that you forgot to remove stand of your bike, without charging money.

In office, your senior colleague may answer your queries or act as a mentor free of cost.

Now see Facebook and Instagram. How much money they would earn if people didn’t share their pictures and art free of cost.

Would Amazon feel the same, if reviewers didn’t post product reviews for free on it.

So, capitalism may boast of anything but it is nothing without this daily communism.


Elinor Ostrom took this idea to her heart and studied how humans can judiciously share common resources without need of a state or autocracy to intervene.

This concept of commons need to reach more people and should be recognised for its vital role.

Her studies got Elinor Ostrom; Nobel prize in 2009 but still capitalism with its bright lights is outshining the garden of commons.

Inspiration – Humankind by Rutger Bregman

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Simplest way to be happy! #Alfredalder #hapiness #psychology

Ever wondered why it is so hard to be happy!

When human beings started as a hunter gatherers, it was relatively easy to be happy. You needed few things to be happy. You needed food, water, warmth, safety and a family and you were okay.

Their were no stocks, bills or quarterly targets.

As time passed, hapiness got increasingly attached to external things. It depended on things you could gather and then feel happy by displaying those things to others. Humans started collecting land, money, metals, fat and servants.

But then things got more complicated. It was still hard to be happy.

They stocked more and more stuff,only to see that it got outdated before they could earn enough to buy its next version.

They needed pills more frequently to be happy and feel meaningful.

As incomes grew; after a particular level of money; hapiness stayed the same.

So, it was probably wrong approach to achieve sustained hapiness free of transient dopamine spikes.

Only when hapiness is detached from the external things, tgen only it can become stable and eternal.

When I read , courage to be disliked, I realised it was the simplest philosophy to be happy. Although it was hard to apply fully in real world; but it provides framework over which sustained hapiness could be developed.

I will share few of these concepts of Alderian psychology in this blog with illustrations.

Here we go.

1. Think in terms of teleology and not in terms of aetiology.

Aetiology is cause of an event. Teleology is purpose behind that event.

For example if somebody is depressed, we may deduce that, he is depressed because of his troubled home environment. ( Aetiological explaination)

In teleolgical terms, person has created depressive symptoms to avoid the effort of sorting out causes of his depression. ( Teleological explaination)

So, if we start seeing things in terms of hidden purpose, in stead of exact cause; it will be easier to start acting for improvement of the condition.

Aetiology provides difficult route to a solution. Teleology makes it a bit simpler. Aetiology gives causes, teleology guides towards possible solutions.

2. Stay away from life lies –

Life lie is lie that we make to avoid change. We shift blame from ourselves to someone else.

Like feeling inferiority to avoid being courageous enough to change your circumstances. It is easy to stay locked in home by constructing life lie of inferiority complex; than going out to face your fears and making best of whatever talent you possess.

3. Once you find purpose behind a particular symptom, you need to accept yourself and move ahead in spite of the fear. You need to have courage.

As all great minds have said, we choose our emotions, our reactions to a particular event and meaning that we provide to a certain event.

If you accept these, you give yourself power to change.

Humans are slow to change. Change needs courage. Change is inconvenient. Change needs sacrifice and pain.

We rather choose to avoid it. We may create symptoms like anger, impulsiveness, depression, irritability, inferiority to avoid the change. Our purpose of all these symptoms may be an effort to avoid process of painful change.

Better thing is to see that you can change situation with hit and trials using courage and assistance from your family, meditation or your doctor.

First you need to know that you have power over your response and thoughts.

Think I have ability.

4. All problems are interpersonal problems.

All problems can be seen as problems arising out of our relationship with others and situations.

Don’t put your happiness in the hands of external things. Other people or things or situations. This will free you of a lot of burden.

Keep out of useless competition. Don’t get sucked up into useless struggles, to prove your superiority to anyone. Even if you are correct, don’t assert your yourself. If you are right, don’t sweat to prove it.

Don’t fall in trap of reward punishment circuit.

Step back and show no reaction. See problem in the circumstances, not in the particular person.

Life is not a competition. Don’t compare with others, compare with your old self. You should be improving with time.

5. Develop feeling that all people are my comrades. Develop horizontal relationships.

All humans are not same, but all are equal. Consider everyone as your friend or comrade.

It gives you power to think positively and to stay away from negative feelings. This will give you ability to see their perspective. It will solve a lot of problems.

Treat everyone as equal with no bias or hierarchy. It gives community feeling. Know that you are not centre of the universe and don’t expect many things from others. See what you can contribute, in place of what you can get.

6. Seperate tasks –

See clearly which is your task and which is not. If it is not your task, don’t overindulge in its execution. Provide nudge or guidance but don’t do it yourself.

For example, if child is not studying well understand that it is his task. Tell him that studies are necessary for him. Provide for tuition, reading space and help whenever he requires. But don’t force things on the child or punish.

Let him walk his path himself, so that he learns to face life alone.

7. Know that contribution leads to hapiness –

If you contribute to society and other people, your feeling of self-worth and hapiness are exalated. Believe in others. Don’t generalise things.

Few bad events or people don’t make everything bad.

Contribute according to your ability. But still know that person is worthy for being or existing. His contribution increases this worth.

8. Know that life is a journey, not a destination. Life is a series of dots, it is not a straight line.

To summarise everything.

See purpose of an event or action. Seperate tasks. Focus on internal drive for hapiness. Treat everyone as comrade. Solve interpersonal issues. Have courage to change.

Have courage to be disliked.

Inspiration – Courage to be disliked

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Why refugees use boats? #immigrants #europe

Category – business and money

Reading time – 3 minutes

This story is taken from the book, factfullness.

It is eye-opening write-up. It tells us that; even if intentions are good and legislation in place, still beneficiary may be deprived of a benefit due to misinterpretation of things and complexities of a process.

In year 2015, as people tried to flee to better lands amongst middle eastern Syrin war. As many as 4000 refugees drowned in meditarranean sea; as they tried to cross it with inflatable boats.

They paid loafty money to mediators and found themselves with their families; in the middle of no where.

This happened in spite of Geneva convention aggrement; which enables refugees from Syria to seek asylum in Europe.

But, when people tried to reach airports they faced effects of anti illegal immigrants directive, which was designed to stop illegal immigrants. This directive required airlines company to ship back illegal immigrant for free.

Hence, on airport counter every asylum seeker was seen as illegal immigrant. Hence Geneva convention failed to help them due unclear and complex process.

Why didn’t they use good boats.

Because, there is EU policy to confiscate illegal boats. Hence, if people used boats they will be captured and gone

Hence, desperate people used inflatable boats which are very unstable and risky.

Hence inspite of remedy (permission of asylum under Geneva convention); it was really hard for refugees to reach Europe to seek asylum.

Inspiration – Factfullness by Hans Rosling

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Selling below cost and still earning profits! #factfullness #money

Category – business and money

Reading time – 5 minutes

This story depicts out the box thinking and alternative approach to a business.

Businesses aim for profits; but sometimes innovative thinking is required to defeat competitors.

Profits are not visible directly, but are indirectly produced by a business model.

Here is one story, that shows exactly how a business can be profitable; even if it gets price below cost of raw material.

Rivopharm is a family pharmaceutical firm in Swiss Alps. It won contract to supply antimalarial drugs to African countries through UNICEF.

It was in bid with other competitors. In its bid value requested for each pill, was lower than the cost of the raw materials.

How this company could offer such a low bid.

Investigations revealed this.

UNICEF contacts are big contracts with long long tenures. It involves big money.

Rivopharm had invested earlier in robotics. It factory had speed. Its factory could make more pills per day than competitors.

Raw material arriving in to the factory on 30 day credit.

Raw material of drugs arrived to its factory in trains. And, within two and half days, it could produce and pack all raw material into final finished pills.

Raw material in the factory

By Thursday, after delivering pills at Genova headquarters of WHO; they get paid on same day. So, in 4 days they get paid for their supplies.

Robots working to make pills

Suppliers of raw material give them time of 30 days to repay.

Hence, large amount of money that they get, accumulates interest in bank account for 26 days!

Delivery of pills and payment by WHO on day 4.

It compensates for their discount and also provides profit.

It also brings more offers at their door as their brand value increase as a reliable generic drugs supplier.

This all is impossible with conventional drug manufacturing facility.

Hence, business is profitable. Not from conventional way of analysis but from Innovative approach.

And their robots don’t demand payhikes or leaves. They complete projects on time.

Inspiration – Factfullness by Hans Rosling

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Leadership lessons from navy SEALS #extremeownership #sniper #personalgrowth

Category – psychology

Reading time – 5 minutes

Jocko Willink and Leif Babin are former Navy Seals who fought in IRAQI town of the Ramadi.

They have now written about their experiences of war and lessons that they learnt, in a little beautiful book , “The Extreme Ownership.”

Let’s see what we can learn from this book.

1. Leader must take extreme ownership of everything bad that happens to his team and mission. He should not blame anybody else.

2. There are no bad teams, only bad leaders.

3. Leader must have a unwavering faith in his mission and team. He must be able to make his team believe, that their mission is vital and must.

4. Leader must not try to nurse or assert his ego. He must accept his mistakes and improve plans of their mission.

5. Cover and move. Each member is vital and win is only possible by teamwork. Each member of team should support other members.

6. Simplify your message and processes, so that team can easily understand it even in extremely daunting situations.

7. Prioritize things. Get decisively engaged, so that you and your team doesn’t have to think about retreating ever.

8. Decentralise Power. Delegate responsibility to your team members, so that efficiency can be increased.

9. Each member should take responsibility in case he finds mission is getting offtrack.

10. Practice with discipline all your important tasks, so that doing them takes minimum effort. Discipline gives freedom.

11. Always know that most of the times leaders have to make decisions based on incomplete information. Have courage to make quick decisions.

Inspiration – Extreme ownership by Leif Babin and Jocko Willink.

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