Dayara Bugyal & Dodital trek – A photo/video blog of our 50kms trek across two mountains. [1] From 7k feet base camp (Raithal) to 12k (Dayara top), then down the other side to the Assi Ganga river at 9k (Satghadi). [2] Crossed the river and climbed up again to 11k ( Dodital Lake) and finally down to 8k to reach the final road head (Agoda).

Day 1 (Bangalore to Dehradun)
* We’ve arrived at Dehradun and spent the night at a lovely Airbnb near Jolly Grant airport. the host has created a tastefully done up cottage at Thano jungle in the foothills. 

https://www.airbnb.co.in/rooms/10505374

* It’s blazing hot in Doon, even at the outskirts. We are told Bangalore is at a cool 19 deg and roll our eyes. But it cools off by evening and the place turns out to be a haven for bird watching. Feels like a place we could have spent more time in. Preferably in the winter.

* Next morning starts with a bone jerking car ride from Dehradun to Uttarkashi and then to Raithal, up in the hills. 7 weary hours, battling the “yatri” traffic. Can’t wait to get away.

 * Multiple checkposts insist we register as “yatris”, even though we explain we aren’t on a pilgrimage. Traffic jams at many junctions. Road work, dust and landslides mar the green landscape. It’s almost like a preview of how humans can screw up nature, before we get away from it all. 

Day 2. Start of trek (7km, steep uphill to Chilapada campsite)

* Our climb starts from the last road head via Uttarkashi.. Raithal Village at 7000 ft. Urban ills have caught up with Raithal and it isn’t that pretty any more. Too many buildings. We are happy to start climbing away from it. 

* Steep climb through mixed Oak and Pine forests. Two lovely mountain dogs join us. One white and the other black. A handsome couple that we named Heera and Moti. They follow us for a while. And then return with another group to Raithal. Seems to be their regular routine.

* Plenty of bird life, especially around the small grasslands and shrubbery in between

* First camp is at just under 11000 feet. Everyone is tired and AMS hits a few as we have ascended almost 4k feet quickly on day 1. Diamox to the rescue!

* Saw our first yellow throated marten going up a tree and a pheasant that looked like a Monal, but hard to say for sure in the low light.

Day 3 (6km up to Dayara Bugyal and then down to Nimdhaar campsite)

* Left the tree line and ascended to Dayara top at 12000 feet. 

* Rolling grassland meadows all around. Covered in a carpet of summer flowers. Absolutely stunning 360deg views. Snow-capped Bandar Poonch mountain and Gangotri 1,2&3 in the background

*Crossed the top and made camp on other side at 11k feet again, next to a mountain stream. First body wash in ice cold stream water. Hands went numb for a few minutes, but felt great.

*Bandar Poonch mountain with its snowy resemblance to a monkey lying down watches over us.

* Hailstorm starts, followed by pouring rain. It’s freezing cold! Stuck in our tents the whole afternoon. Kitchen folks go out of their way to send tea in flasks to the tents. Luxury!

* Weather clears up by evening, but it’s biting cold with wind chill. Amazing views of snow capped mountains makes up for the harsh weather.

* All the wood is wet and can’t build bonfire. We discover a gujjar camp nearby that has just been set up. They warmly invite us to their dera and sit with us around the campfire with tea. They offer us buttermilk and we arrange to buy paneer for dinner.

* Fascinating people. Islamic community that lives and moves with their buffaloes across the landscape. Warm and welcoming. “insaan hi insaan ke pas aata hai” is their simple philosphy. Living totally off the landscape with no external support or technology. 

*Every 3 days, someone from their “dera” does the entire trek down to Uttarkashi to sell the Paneer they make and comes back. Humbling to realise our “trekking” is their weekly routine

* Some last minute birding in the morning. Good sighting of black & yellow grosbeak, blue throated flycatcher, rose finch etc

Day 4 (7km steep downhill to Satghadi camp)

* Today is a descent down to “Assi Ganga” at the bottom of the mountain. Apparently 80 streams merge to form the Ganga tributary at this stage.

* The tree line starts again. It appears we are one of the first groups to go down this way. Trail is wiped out in some places and very steep. Need to slip and slide down some tricky slopes.

* Signs of wildlife appear. leopard and bear scat etc.

* Lots of small wild strawberries everywhere. Eat as much as you can bend and pluck 

* Can hear the roar of the river and our camp is nearby, but we have lost our trail. We back track for some time and finally make it.

* When we finally reach camp, it is spectacular. We are on a grassy ledge with the forest on one side and a sheer drop to the glacier fed river on the other. A stony cliff rises up on the opposite bank and towers over the campsite. all the tiredness of the trek melts away and we literally shout in glee. There is no human in sight for miles of pristine jungle.

* We again sight 2 martens and I photograph several specialist riverside birds like dippers, redstarts etc.

* Weather swings between cold, rainy and windy. But allows us to get a nice fire going. Hot soup and roasted papad seem divine. We are now back down to 9K feet from 12k.

* Dinner includes “lengda” or fiddlehead fern sprouts foraged from the wild. A lovely, unique taste. You have to be able to identify which ferns are edible. Not all the curly stuff is safe to eat.

Day 5 (8kms first steep then moderate uphill to Majhi)

* We cross Assi Ganga river and start climbing again. Now it’s steep and slippery, but bursting with birds. Some of us hold up the group. While they patiently wait, we scramble around the hillside, chasing photos of laughing thrushes.

* We start climbing towards Manjhi on the way to Dodital. The cameras are starting to magically weigh more every day. Must be some gravity thing.

* We reach half way and find a bakarwal who tells us that the trail ahead is washed out. So we must circle around the mountain and add a km more to the route. but its less steep. So it should be ok.

* At Manjhi, we find a deserted village, save for one old man who must be at least 90. He’s been staying alone there for over a month & is happy for some company. A hookah appears and the nicotine deprived partake of it gratefully.

* Manjhi turns out to be the best camp for birding. Rose finches are scattering all around, interspersed with woodpeckers, warblers and flycatchers. 

More photos on Instagram https://www.instagram.com/wildtails.in/

* As dusk draws, a langur starts giving a harsh alarm call around the camp. The mule drivers get very worried and the animals are spooked. A leopard is afoot! The mule drivers build a huge fire that must burn through the night.

* Dinner includes creamy white mushrooms foraged from the wild. Absolutely yum.

Day 6 (5km moderate up/down to Dodital lake)

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* We start climbing the final leg towards Dodital at 11k feet. We can now see the mountain that we have just climbed up and down on the other side. At 12k feet+ it looks massive and impossible to climb. Thank God we did not have this view before we started.

* Dodital is supposed to be the place where Ganesha fought with Shiva as he was guarding Parvati while she was bathing. And hence ended up with his elephant head. Thankfully the spot hasn’t caught mass attention yet and it’s still very remote.

* We are greeted by a pristine glacial lake at Dodital. The landscape on one side is marred by some ugly shacks and buildings. Only the old temple is aesthetic and quaint. The shop cum dhaba and forest dept huts are eyesores. But the other side is pristine with sheer forest and a stony glacial melt trail leading into a crystal clear Lake. Must be around 1 km in circumference.

* Gujjar kids come running up. Cute lil tykes with hands outstretched. “Mithai” they lisp. Looks like the tourists have got them into the habit of asking for chocolates. But who can resist. We comply half guiltily.

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* Camp is set and the challenge is thrown. How many will brave the biting cold and take a dip in the lake fed by glacial melt water. Five people, including yours truly say yes. We take a deep breath and jump into the water. After the first shouts  of shock, the effect of the freezing lake water is magical. All tiredness melts away. 

* Later we go for a walk along the pretty track that circles the lake and settle down for a hour long wait for the beautiful Monal, a spectacular multi coloured bird that is the state bird of Uttarakhand. But it decides not to show itself, though this is a common spot for it. That’s what usually happens to birders with cameras in tow.

* Dog #2 joins the group. A cute white female who seems to be the local shop keepers pet. 

* The Poojary invites us to the evening arti at the temple. All of us cluster around on the old wooden floor as incense smoke, lamps, bells, conch sounds and mantras fill the air. I’m not usually a religious person, but there’s something spiritual about small remote temples.

* It seems the white dog knows the temple and the sweet prasad well. She starts nose bumping our hands as soon as we emerge and I guiltily give her my share, wondering if it’s sacrilege. But hey, she’s God’s creation too and needs it more than me.

Day 7 (14 km moderate downhill to Bebra)

* We start going down to our final camp at “Bebra” village in the valley. It’s going to be a long walk of 14km today. But mostly downhill on a well-defined path. So should be doable.

* The white dog seems to want to leave Dodital and come with us. The shopkeeper says she’s not his pet. Seems to be lactating, so where on earth is she going? We are worried, but after a while she takes off ahead on her own.

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* The views on the way down are breath-taking. Narrow paths with steep falls of thousands of feet in one side and towering mountains, across on the other side. 

* We hear a rustle on the steep grassy slopes and look up to see a herd of “Goral” running away. A sort of cross between a goat and an antelope, they are extremely shy. I scramble up the steep slope, but spook them further. When I give up and come down, I find a female curiously looking at me from a higher ledge and manage to squeeze off a few pictures.

* The tree line starts with Oak, Maple and Pine and then slowly shifts to Fir and Rhododendron. Some old and gnarled rhododendrons are clearly decades old and the size of big trees. We’ve been drinking Rhododendron (buransh) squash along the way. Can’t say I’m a fan. Bit like a watered down Roohafza.

* Bebra turns out to be just ahead of Agoda, which is the final road head. An alternative campsite for those who want a last bit of solitude, away from the road access.

* The local dhaba gives us a campsite by the river. And A dry roofed platform to congregate at in the evening.

* The white doggie reappears. Proudly bringing along her fat and cute puppy to introduce him to us. So the mystery is solved. she’s actually from here and does the up down to Dodital with groups.

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* Our treks with Wildrift & DeepDiveIndia always end with an evening of song and celebrations around the camp fire. Today is no exception. The entire team of cooks, guides and staff joins in and we spend a mellow night listening to pahadi songs and crooning along to “thando re thando… mere pahadon ki pani thandi, hawa thando”. A magical evening indeed. We have been trekking with them for a while and they have consistently given us great experiences.

https://www.wildrift.com

https://deepdiveindia.com/

Day 8 (3km easy downhill to Agoda)

* Our final day. The mandatory group photos are taken and we set of on the final 3km to Agora, which is home for some of our trek leaders. 

* Agoda turns out to be another version of Raithal. Roads do something to villages. it’s hard to say whether they are the better or worse for them.

* A jeep is waiting to take us till Uttarkashi as the road is still under construction and only jeeps can do the route. We are packed to the rafters. Luggage on top and 9 people in the long Jeep. But it’s just a 2 hr ride so we should be ok.

* Within half hour of starting, we find two desperate village women on the road with a baby. The baby is sick and they need to reach the hospital in Uttarkashi. There’s no choice but to squeeze ourselves in further and somehow accommodate them.

* We reach Dehradun that night and check into our final Airbnb. It’s not so great and we want to get out for the evening.

* We are recommended “The Bungalow” for Doons fanciest experience. Or “Kalsang” Tibetan restaurant for yummy authentic food. We opt for the latter as neither our wardrobe nor our system was ready for a fancy restobar. 

* Kalsang is packed! To the rafters. A traditional Tibetan eating place under siege by the Punjabis (there seem to be a lot of them in Doon) in their fanciest clothes and pushiest personalities. We stand around like deer in headlights, until Tenzing kindly rescues the southies and gets us a table.

 * We over-order. And we over-eat. Now we know why the place is packed. Fantastic authentic food at reasonable prices. Dishes that we haven’t heard of. New flavours. All good.

* Over to Bangalore.

More photos on Instagram https://www.instagram.com/wildtails.in/

X——-X

When a friend called and asked me whether I would like to review a book on Royal Enfield, or “RE” as it is referred to amongst its enthusiasts, my interest was piqued. I have had a ringside seat to the brand for almost two decades by virtue of being closely engaged to the brand and riding as well as to several of its protagonists. What could possibly be left to write about, I wondered, given that the brand had literally been written about ad nauseum over the years. Every bit of “content” had been squeezed from it by a legion of journalists, bloggers, copywriters, business analysts and story tellers. So what now? Is it possible that the writer had managed to go beyond the obvious and ferret out hidden secrets of the brand and its mind boggling success over the years? Had he managed to touch its soul and speak to its heart? Perhaps even star gaze into the future? 

Unfortunately, by the time I turned over the last page of the book, my hopes were somewhat tempered. It becomes clear fairly quickly that the book sticks to a reporting format, rather than going deeper into insights and analysis. The content is largely based on interviews with company insiders and thereby limited by their field of vision. Not much attempt has been made to understand the emotional and sociological constructs of what represents a biker and how that reflects upon the brand in turn. It’s informative and mildly interesting, without being deeply engaging or thought provoking. 

The first part is an averagely engaging company infomercial with a documentary type feel to it. Readers unfamiliar with the RE story would find the trivia interesting, but others would end up skimming through it. Things then start to get interesting towards the second half. Not because it dives deeper into the brand building world, but because things start to go wrong in paradise. The book switches to juicy internal gossip backed by surprising straight talk from company insiders, some of whom still work for the company. There are moments of refreshing clarity and candor and one can see the writers own understanding maturing as he speaks to more people and spends more time with the brand. 

I find myself wishing he had persevered a little more in building that relationship with the brand. One wonders if he would realize at some stage that there was one big missing piece from the entire puzzle. The external community of riders, mechanics and enthusiasts who in many ways made RE what it is today. And perhaps therein lies the untold story? At some stage RE obviously became much more than just a consumer brand. It started to represent a way of life, a certain personality, a way to be and a way to engage with the rest of the world. The company and its advertising gurus admittedly spotted this possibility early and gave it plenty of nudges in the right direction. But the real establishment of this brand as a lifestyle happened organically, outside of the company walls. It was driven by its users and predominantly by the strong and close knit riding clubs that emerged at the same time due to a cocktail of cultural and economic shifts in urban India. These clubs defined, built and enforced what it meant to be RE and a RE rider. The company often just efficiently piggy backed. Many clubs bordered on being cults with their own gurus and groupies. Being part of the community meant not just being a rider, but following an unwritten code of ethics and behavior, subscribing to a set of shared beliefs as well as proselytizing to non-believers with almost religious fervor. All of this created a close knit, supportive and emotionally gratifying family which millions of Indian youth yearned to belong to. They were going through an identity crisis and looking to break free from the shackles of a predictable, monotonous Indian middle class life. In that sense the external communities impact was amplified several times over. And not just in terms of brand building. Some of them also contributed to product development and design of models that were later to emerge from the RE stable as indigenous developments. Many aspects were rumoured to be copied or ripped off from prototypes built by the community and never tacitly acknowledged. Juicy stories waiting to be picked. This is such an interesting, layered and important part of the narrative, that it almost seems inexcusable to have blanked it out from the larger story. It also answers the question that must inevitably occur to the author and to all readers. Why isn’t RE able to replicate its roaring success in other countries, using the same formula?

The community is the missing link that the book fails to find. 

The book also presents the entry of Rudy and the following internal turbulence within the organization as one of the defining moments that upset the band wagon. But one also gets the sense that in many ways, Rudy was in the right place at the right time, and then in the wrong place at the wrong time. His impact on the brand seems frankly overstated. Maybe the real Achilles heel of the company was a far more fundamental relationship failure with its own stakeholders? Did the company get caught up in the dizzying momentum of the growth they were witnessing? Or perhaps some degree of hubris set in? For e.g. the writer mentions the popular Sturgis style event, “Rider Mania”, more than once in the book. But he does not seem to have figured out that at some stage, things got so bad that the company and the RE clubs would host separate Rider Mania events, with the company sometimes completely absent from the community event, or at best a grudging sponsor. Nor has much attention been paid to the changing competitive environment and how RE reacted to the same. Over time, other biking brands caught up with the idea of leveraging the “biking spirit”. Product gaps were narrowing and the RE clubs were no longer defending the brand fiercely, riding proudly through the countryside with flags fluttering and creating free content on social media that came straight from the heart. When the brands known weakness around quality issues kept getting amplified on social media, there was no longer a die hard set of influencers batting it back saying “it’s all part of the experience of being an RE owner and the rites of passage for belonging to the community” …. 

Perhaps Rudy was someone who came from the FMCG world and did not understand what it meant for a brand to be like religion. But the book doesn’t ask the logical question that follows. What was rest of the organization and its leadership doing while all this was happening. Did no one notice that the “glue that binds” was coming unstuck? Or did no one care? Was there a corporate culture of using people and groups and dropping them when they were no longer useful? Even worse, did someone make the mistake of taking the Indian consumer and community base for granted as the brand readied itself for global aspirations? These are investigative questions that deserve to be asked. 

The book could have been so much more complex, layered and engaging, if it had incorporated these aspects. But on its own, it is still an interesting slice of automotive history, captured in an easy reading fashion.

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About the reviewer: Sandeep Menon is a Chevening Fellow from the London School of Economics, a board member of the specialized marketing school, MICA and a seasoned corporate leader. His alter ego rides motorcycles and works passionately for wildlife conservation. You can find him at https://www.linkedin.com/in/sandeepm/

For those stepping into the unknown, it is important to note there are some very real dangers facing crypto traders:

1. In India, it’s likely that the government will soon regulate this activity and demand a greater pound of flesh. While traders are already liable to pay capital gains tax, one would not be surprised to see a higher rate announced soon for crypto trading, given its fundamentally speculative nature. One risk is a very high rate of taxation. Another is that the government first tries to fight it by banning it. Which will drive the activity underground and may expose retail traders to elements that they would normally not deal with.
2. Given that there is no real store of value in tokens and they are not really backed up by any hard asset, any crash can snowball into a giant whirlpool. Sucking up investor wealth before they know what is happening. And no central bank or government is going to step in to either bail anyone out or stem the volatility. In such a scenario, simply holding onto a token in the hope that value will recover may not be an option for anyone.
3. Given their fundamental nature, crypto currencies are highly vulnerable to hacking and technological glitches. Make one typo while moving tokens between wallets and you can lose them forever in hyper space. Use a wallet with poor security and an international hacker may happily walk away with your tokens. When that happens, there is no one you can go to. You can’t appeal to the government. You cannot really register a police complaint. You’re in the wild west of the financial markets and traditional law and order has not yet arrived here.
4. Server farms set up to “mine” coins suck up a huge amount of electricity and generate tons of heat. Most countries provide their citizens with some form of subsidized power that has a massive environmental cost. The long term real cost of power and environmental damage is not being assessed by anyone today.
5. When you deal with the equity markets, there are regulators as well as checks and balances in place to prevent market manipulation and insider trading etc. However, in the world of crypto currencies market manipulation is pretty much par for the course. Large players holding huge reserves of tokens and cash in the crypto space are known as “whales” and they get together to pretty much make the price of a targeted token swing in the direction they desire. Unless retail traders can train themselves to recognize the signs and join the swing, they are likely to become the krill who feed the whales!
6. Unlike fiat currency, there is no control on how many coins or tokens can be launched. As of Jan 2018, there were over 1400 crypto currencies in the market and growing. It’s quite obvious that all of them are unlikely to survive. And there’s nothing stopping more from being added on. Something like Bitcoin which was the grand daddy of all tokens is now considered “old” technology by some. Does this mean that every coin will have a life span and be replaced someday? In that case, how does the store of value shift to new tokens? No one really knows how this is going to play out.
7. Given its fundamentally decentralized nature, crypto currencies are almost impossible to track and hence prone to misuse for money laundering and illegal activities. Anyone can produce a few bitcoins on a hardware ledger and claim that they “mined” it themselves. Or that they bought it when it was 20 cents and it is now 20,000 $. But to try and combat this by banning them would be a mistake. It’s like they say about electricity. Just because it can give you an shock and kill you, does not mean you stop using it, do you? You learn how to harness its power in the best possible way.
8. Beyond all this, it appears that the financial equivalent of a confirmation bias is fully at play here. The market keeps going up because everyone wants to believe it will. Even though it is volatile and forms peaks and troughs, its overall trajectory has been upward for a very long time. This allows people to fool themselves into thinking that they are actually expert chart readers and technical analysts. The number of people talking complex chart talk like fibonacci curves and stochastic analysis etc out there is mind boggling. Fact is that if the market cracks suddenly, all the analysis will be replaced with panic overnight. It is very important to stay real and realize that one is riding a wave.

So the Million $ question, is crypto currency for you? Even though there is plenty of money being made right now, people would be well adviced to stay away unless they have a very high risk appetite. And can educate themselves till the level where they can differentiate which technology is here for the long run and how the markets move based on news flows or manipulation by bots. If one is operating blindly on tips and momentum, there is a very real danger of being burned badly somewhere. Despite all this, if you must enter, only risk as much money as you can afford to walk away from completely, and not be hurt in the long run.

First things first.. What really is cryptocurrency? To quickly (& crudely) simplify a complex topic, these are unique digital entities (commonly called coins) based on blockchain technology. A technology that has been designed so that this entity can never be replicated and retains its unique identity all along. Once assigned a notional value (much like a piece of paper is assigned value in traditional currency) it continues to be associated with some value forever, due to its unique identity. Cryptocurrencies are believed to have been created by technologists as a decentralized community-owned alternative to the current system where central banks print currency and governments bail out entities based on their whims and fancies.

How do you lay your hands on one? There are three ways. Either you digitally “mine” a coin, earn it by providing an asset / service, or you buy them on one of the many coin trading exchanges that have now been set up across the world. Digital mining is an interesting “self propelling” process where you devote a certain degree of computing power to the coin, in a sense “searching” for undiscovered coins in the internet space. The coin algorithm uses this compute power to perform the tasks of unique identification for the coin in daily usage and in return for the compute power you have devoted, you get rewarded with more coins (which are auto restricted in number)! People have now set up huge server farms devoted to this function. The easier and most common way of course, is to sign up to a coin trading exchange and buy the coins for cash. People then tend to engage in a popular activity called crypto currency “trading”.

So to begin with, the entire activity of financial trading in this space should probably be called blockchain trading as not all the assets being traded are necessarily cryptocurrencies. For e.g. one of the top 5 traded coins is “Ripple” which was designed purely to enable financial transfers within the banking and financial system. Some other coins are focused on enabling b2b commerce or authenticating contracts. So let’s understand that not all blockchain based entities are necessarily “cryptocurrency” in the traditional sense that we use them to buy coffee someday. Some other popular coins are Bitcoin, Ether, Litecoin and hundreds more. In most cases there is no central entity controlling them. Once they are created (or mined) they are out there and keep varying in value.

There is also an ongoing debate whether traditional “cryptocurrencies” such as BitCoin are truly currencies or a form of digital gold. Until widespread use of cryptocurrency for purchase and consumption of everyday goods becomes common, this debate will likely continue as the cryptocurrency holds value today largely when backed up by “fiat currency” (common currency) issued by a government. Most commonly US$.

Is cryptocurrency trading legal in India? Here’s where it starts to get interesting. There is no law making it expressedly illegal. But when someone trades large amounts on an international exchange, one could argue that they start skirting the borders of several legacy laws such as FEMA which simply did not take digital currency into consideration. Today, digital currencies can be bought on Indian exchanges or digitally “mined” and carried on innocuous hardware like secure USB keys. They can also be digitally transferred into international wallets, traded and transferred back. This obviously represents several headaches for governments as it can go around the world without getting tracked. Initially governments around the world tried to crack down on cryptocurrency. But they soon found that this was a losing game as it was impossible to police, given its decentralized nature. Now they are realizing that it is probably better to regulate and not worry about what’s happening while it’s on the internet. If governments can regulate it at the point where it is cashed for fiat currency like INR, then they stand to make a windfall from taxes collected which one imagines will be substantial. The RBI has however, warned the Indian public to stay away from cryptocurrencies, as they are prone to creating asset bubbles. This has set off a sort of proxy war by the banks on behalf of the RBI. Private banks in particular are taking the safe way out and restricting access to crypto exchanges. There are also reports of accounts actually being shut down, if found linked to crypto trading. All this is bound to be temporary in nature and the government is soon expected to outline its policy on the matter.

Then there are some  people who visualize cryptocurrency as upsetting the entire world economic order. Which is not entirely fanciful thinking. A lot of the current world order is implicitly maintained through clever post war manipulations like the Bretton Woods agreement and institutions like the IMF and World Bank, which made US$ the global standard and continued to keep it so, even when the US government delinked the US$ from gold in the 70s. This has allowed a coterie of western nations to pretty much control the economic fate of several countries for decades. If cryptocurrency gains favor, that control evaporates. But this is unlikely to happen without a desperate fight. Case in point are the several wars that were fought in the middle east, ostensibly to bring “democracy” but often because the oil rich nation threatened to trade oil in some currency other than the US$. Is this world order set to change? We can only wait and see. But nations such as Venezuela are happy to embrace cryptocurrency for this very reason.

Coming to the question on every mind. Is there money to be made in crypto trading? Well, it is a fact that some people have already made fabulous amounts of money in crypto trading. Almost unimaginable returns ranging from 200 to 3000% and in some cases even more. So is this a huge asset bubble? Nobody knows? Is it going to crash? Again no one knows. But the number of people joining the party is huge. Indian and international exchanges like Koinex and Binance are witnessing millions of new users being added every month. In fact many of them could not scale and had to suspend new user registrations for weeks together while customers impatiently waited with money in their hands! Tokens like Ripple are witnessing lakhs of transactions every day on Indian exchanges. And it’s not just the tech savvy who are on the bandwagon. A cursory glance of any crypto trading group reveals a melting pot of socio economic classes, including businessmen and traders who deal in crores as well as scores of ordinary people who may not even fathom the technology and are putting in small amounts like 2 or 5 thousand rupees in a desperate attempt to double it in a month, because someone has told them so. Often they get stuck at every stage, including currency deposit into the exchange and so on. One even hears of seminars being organized in small towns where various versions of “give me your money and I’ll double it” sort of shady deals are being perpetrated.

The only folks who really seem to understand this animal appear to be the 20 something geeks. Now seasoned older investors who spent years turning up their noses at these geeks and their “games” are beating a beeline to their doorstep as “FOMO” (fear of missing out) takes over. The catch here is that while equity trading and crypto trading may appear similar in many ways, they are fundamentally different. The reason 20 yos are so good at crypto trading is because the price movements are fundamentally based on 2 things as far as we can see. One, news flows on social media about upcoming use cases. And two, the visual spatial-trick of chart reading and volumes which predict when the crowd is going to act and in which manner. And it’s all instant. Real time. Blink and you lose. Unless you are plugged into every possible electronic news feed from reddit to twitter and private chat rooms, you are likely to miss the news that spikes the price within minutes. This also means that most crypto traders spend sleepless nights & days stuck to their screens, as this is a 365 x24 x 7 activity that never ceases.

So is this a giant fireball that is going to crash and burn someday? Yes and no. Cryptocurrencies look like they are here to stay because they are not controllable by traditional government models. The entire concept is somewhat anarchist in that sense. But not all will survive and many will lose their entire store of value.

It is important to appreciate though, that crypto currencies also represent a real opportunity, especially for developing nations, to counter unfair trade practices based on predatory monetary policies of entrenched powers. The technology also holds the potential to rapidly bring the unbanked into a formal monetary system using ubiquitous mobile phone technology instead of waiting for a bank to open a physical branch somewhere. So to blindly see it as a threat to the established world order would certainly be short sighted.

(Read Next: The real dangers of trading in  Crypto Currencies)

Where angels fear to tread.. Cryptocurrency

There are some people who consider the entire space of equities as akin to gambling. They may have dabbled in it briefly, burnt their fingers in a downturn and exited, having reinforced their initial belief system. Then there are those who understand the difference between long term value investing and the various instruments of trading, such as short term holding, day trading, BTST (buy today sell tomorrow), futures and options etc.

The objective of this article is to try and get into the nuances of these instruments and examine if they are all sheer “gambling”.

To begin with, there is some credence to the belief that the stock market is indeed a form of gambling, especially in certain scenarios. And the reason is that there is only one thing for certain in the stock market.

And that is “Randomness”. (In fact, this is true of the universe as a whole) *

It is impossible for anyone to perfectly predict the future in the stock market. No expert can genuinely do this at an aggregate or individual stock level, however much information they may have. No one can foresee the occurrence of a black swan event. Hence if someone says a scrip is a “sure bet” in x days, then you know they are winging it a little bit. Most experts who appear on TV screens and coffee room discussions are like soothsayers who can look at the circumstances and make a fair guess at what could happen. But that’s about it.

So what we have to work with instead, is “Probability”. (A fairly robust field of study in mathematics)

The thing about probability is that its accuracy vastly improves if you can stretch the period of time over which it operates. This creates the fundamental difference between long term investing and various forms of trading. If you can gather as many complex factors as possible to calculate probability, make a forecast and give it a broad enough swathe of time, then the possibility that the forecasted event will happen within that period becomes fairly high. Only in this scenario, can we seriously start pulling stock investing out of the “gambling” zone.

In short, there is really no alternative to long term value investing in the stock market. One would be well advised to hold at least 80% of one’s portfolio in this space at all times. (5 to 10 years window)

Conversely, all short term transactions tend to suffer from poor predictability (unless one has insider information). In addition, some short term transactions typically tend to be leveraged (using borrowed money on top of ones own). This means that the ability to hold out is even shorter, bringing it very, very close to gambling.

Does that mean one should avoid all short term instruments like the plague?

Well, not necessarily. My personal belief is that one can ring fence a small corpus and set it aside for trading. This helps satisfy the “greedy gambler” that exists within all of us at some level and prevents the larger portfolio from getting damaged by an uncontrollable urge that takes over at some stage in the market J. To paraphrase Gordon Gecko “Greed is good”… but do make sure it is caged in!

So what are the short term instruments and how do they fare in relative strength to each other? Having accepted that they are all risky propositions, it becomes obvious that one can only manage the degree of risk. This brings us to one of the most important investing insights that is very rarely discussed.

Successful investors always focus on minimizing risk vs possible rewards, not merely managing for maximum gain.

The reason is very simple. Minimizing risk is in our hands to some extent. Driving outcomes is almost completely out of our control. Hence in probability terms, it makes far more sense to minimize risk than try and manage outcomes (or results, profits… whatever we want to call it).

Keeping this in mind, let us look at the various short term options available in the market today. These are my impressions after having dabbled with all of them.

1. Short term holding or “churning”: A process where one keeps short term price targets, get out when the target is hit and shifts to the next popular stock. Typically within ranges of 1 to 6 months. This tends to be popular with some folks because it gives an illusion of control and keeps you engaged with your portfolio. But there is enough research now to show that constantly buying and selling produces no better returns than a portfolio that is a simple buy and hold over say, 5 or 8 years. In fact it uses up more time, you pay more taxes and very often you make lower returns, because it negates the power of compounding!

Compounding is quite possibly the single largest wealth creating process in the world. Einstein quite succinctly referred to it as the 8^th wonder of the world.  (The power of compounding is an entire topic in itself, which we won’t cover here)

2. Day trading or Intraday: An extreme version of short term, typically where large amounts of borrowed money is used to profit from movements in stock price within one day. If anything can be called sheer gambling, this is it. There is an entire industry built around sharing tips and manipulating share prices. Historical data shows that a vast majority of retail day traders lose money very quickly and in large amounts. It may be possible to make money in day trading by keeping expectations low and strictly managing stop losses. But having done it, I can express my opinion that this is a mugs game. It traps unwary investors who do not have super computers and algorithmic trading engines behind them. The risk profile is way too high. Time commitment is insane as you have to be stuck to the screen the entire day. My suggestion would be to strictly avoid.

3. Futures & Options: Both futures and options are like “advance payments”. You pay a certain amount as a guarantee towards buying or selling a particular stock at a pre-defined price & quantity on a future date. The difference is that in futures, you have to buy or sell the entire lot when the defined date comes up. While in Options, you could choose to forgo the advance amount and not complete the transaction. These are both slightly better instruments than day trading as you can apply thought to why a scrip should rise or fall and have the time to ride the mkt. Typically the contract period is for a month and you also get the opportunity to sell your deal to someone else in the meantime. Meaning you can continue to trade your f&o commitments throughout the contract period, if you feel it isn’t going your way.

Why does f&o exist? It was typically designed by large funds as a form of insurance. They would take large hedging positions to protect themselves in case something went wrong with their deals. If nothing went wrong, they would only lose the advance, or margin money. But now it has become a trading engine like everything else.

The problem with futures specifically is that while it has unlimited upside, it also has potentially unlimited downside. On the day of expiry, if your stock has lost 30%, you lose 30% + the margin money you paid. While in options you can choose not to execute the deal and lose only the margin paid. However, options tend to erode value with time while futures don’t. (We won’t go deeper, lest this turn into an f&o tutorial.)

Of the lot, I find options to be most advantageous, because one can manage risk accurately. We know that the most money we can lose is the advance or margin money paid. If the stock does not rise by date of expiry, we walk away and lose the advance. But if it does rise, then upside is potentially unlimited!

In my opinion, this combination of limited downside and unlimited upside makes options an attractive instrument within the risky basket.             

4. BTST or Buy Today Sell Tomorrow: Pretty self explanatory. This is when you buy a stock and sell it within the 3 odd days that the exchange gives you to come up with payment and take delivery of the shares. Effectively this is more or less the same as futures without the margin payment. However, you’re playing on the T+3 days which gives you only a short window, and you have unlimited risk and potential within that period. Might as well go with options if it’s available on f&o

In summary, our core objective should be to minimize risk vs possible reward. Hence a strategy that is heavily weighted towards long term holding with some portion set aside for playing the options market appeals to me the most. (disclaimer: this is a subjective opinion)

Suggested reading:

* “Fooled by Randomness” by Nassim N Taleb  https://en.wikipedia.org/wiki/Fooled_by_Randomness

** Using Game Theory to Model Market Uncertainty http://www.minyanville.com/businessmarkets/articles/game-theory-investment-strategy-probability-theory/2/6/2012/id/39227?page=full

*** Can Math Beat Financial Markets? https://www.scientificamerican.com/article/can-math-beat-financial-markets/

****  Any Monkey Can Beat The Market https://www.forbes.com/sites/rickferri/2012/12/20/any-monkey-can-beat-the-market/#711d5764630a

Chart Analysis Candlestick Trading Courses

It’s the knowledge era. Human beings are used to “knowing” things and if they don’t then there is Google, the precedent of past examples and easy access to genuine experts who can tell us what we want to know.

So what happens when we are faced with a scenario that no one is really knowledgeable about? It appears that rather than acknowledge that we really have no clue, we switch unconsciously to our existing confirmation bias. Telling ourselves that we know this cannot be “good” or “bad” because, well… we know that’s how it is, right? How can we not know?

India’s experiment with Demonetisation is a prime example of this phenomenon. Despite the plethora of expert opinions floating around, perhaps the most honest thing we can say about our experience with demonetization (so far) is that “we don’t know” what the long term impact could be. An experiment of this nature, where 86% of a nations currency is invalidated overnight has not been attempted in any reasonably large economy. So no one really knows for sure how it will pan out. Not the government, not the bureaucrats nor the economists or social media pundits. Everyone is just hazarding their “best guess”

What we do know is that there is short term pain. And then we have extrapolations of both positive and negative long term impacts.  What we also know for a fact is that it was a gutsy and politically risky move to have taken. One that must have had clearly perceived benefits in the minds of decision makers which outweighed the apparent risks. We must appreciate the sheer guts required to take this risk. However, a key challenge of this exercise has been that no one really knows what those perceived benefits really were. The opaque nature of decision making has left us with many a hypothesis and no way of knowing for sure. One suspects that the narratives of black money, cashless society etc are designed for mass public consumption because of an assessment that the real reasons may be too complex for ordinary people to appreciate. This has led to a mini industry of people trying to second guess what the govt actually had in mind. Again… no one really seems to know.

Clearly the impact on black money is likely to be minimal and no long term change in behaviour can be expected unless it is followed up by many more measures. If there are indeed follow up measures in the pipeline then it begs the question why not implement those first in phases, rather than this wide ranging move that affects everyone down to the last man. It appears that black money may be a side-show rather than the core objective, which could also be very sound. But we don’t know.

What is also clear is that if withdrawals are limited as they indeed seem to be, then there is a benefit of pushing the parallel “cash economy” (which is not all black) into the formal banking system. This could well set off a virtuous cycle of improving bank liquidity, allowing them to lend more to large infra projects and hence kick starting what is now a stalled economy (which was inherited from the previous govt). Whether the public would have accepted the pain if this fairly reasonable argument was trotted out is a moot point.

Theoretically we also know that the basic economic formula of mv=py is being severely tested. For the non economic experts (are there any left?) M is the money supply in an economy, V is the velocity of money or the # of times it changes hands in a year, P is the nominal price level in an economy and Y is the real GDP. If the money supply is suddenly restricted by deliberate means and v, p remain more or less constant, then classical economics says that GDP has to fall. Admittedly this is a rudimentary statement and GDP is a complex outcome of many factors. But it just serves to tell us that this is a real long term risk if the money supply remains restricted, even if we consider it to be a combination of cash and digital transactions. If not enough volume of notes is printed to replace the demonetized currency (which has already been confirmed as a stated objective) and adoption of digital channels does not pick  up fast enough to replace the remainder, then we have real contraction in money supply and a possible negative effect on GDP.

Ultimately, the feeling on the street seems to be that some action is better than no action. Across the world there is unrest and disaffection with the “status quo” maintained by the elite and India seems to be no stranger to it either. For the “aam admi”, even pain appears to be preferable to continuing in stupor. If the govt is able to channelize this and actually pull long term economic benefits out of the move, then it will go down in history as brave and visionary. In the meantime people will need to be placated after the glamour of the “tough love” has worn off. To do this it is likely that some of the income mopped up through the VDIS schemes as well as an increased focus on PSU disinvestment, may be distributed as largesse in the budget with the 2019 elections kept in mind. When that happens there will again be a slew of “for and against” arguments, without realizing that these are all subservient to a long term outcome that may reveal itself only after 3 or 5 or 10 years.

• Published on LinkedIn, November 7, 2016

(*Disclaimer. This is purely an amateur view meant for friends. There are likely to be gaps subject to my depth of understanding :))

Reading a P&L or an annual report is an art. It requires a minimum working knowledge of accounting principles to make sense of all the numbers. So not everyone is going to be able to do a detailed financial analysis of a stock they are interested in. At the same time, investing into stocks on the basis of just a “good feeling” or a “hot tip” is a sure fire way to lose money in the market. So what does one do?

Here is a quick checklist I use when I want to grasp the health of a stock quickly, without spending too much time. I have used the “detailed view” of a stock from the website www.moneycontrol.com as a basis for the data, so that we can use screen grabs and explain where the data exists. One could choose to use any financial data site of course. I suggest you go to the site and open any sample stock page now,so that you can refer when required. Here are the 5 steps I use.

1. Check for volatility: Click on the “quote” section and look at the 5-year price chart of the stock. A choppy chart with sharp falls and peaks indicates a high beta stock that may be news or operator led. These kinds of scrips tend to be favorites of traders and often do not deliver the best returns to long term investors, though there may be moments where timing the market perfectly gives you great returns. But if you aren’t watching the market like a hawk, you are likely to miss the peaks. A solid, stable stock on the other hand will have a chart that goes up fairly linearly, except for dips where the overall market went down. A defensive, slow moving stock will show you the median price that it keeps returning to over time. If it is in a trough, it could mean an opportunity for a quick punt. One can also take a look at the “sentiment meter” at the bottom, just to get a sense of what the street perception is, though that is certainly not scientific.

Note:  The “advanced interactive charts” option will allow you to superimpose EMAs and Bollinger bands etc that I don’t understand well enough myself. So not getting into that discussion.

(In this e.g. you can see that this is a slow moving stock that keeps returning to a median price of just under 120 rs. And if you spotted it at 43 in 2014, then you could have tripled your investment by now)

2. Fundamental metrics: Within “quote” itself, scroll down to the “consolidated or standalone figures”. This will tell you the market cap of the company, price to earnings ratios, book value etc.

Take a look at the “book value” of the company and compare it to the stock price. Crudely put, book value is the liquidation value per stock if the company was to be sold today. If the stock price is actually below the book value, this indicates that there is some negative sentiment about the stock. Perhaps they are holding huge debt and servicing it is making them unprofitable. If your research tells you that this is a temporary situation and the company is fundamentally stable, then intuitively you know that some day the market has to value it at a fair price close to, or greater than the book value. That could be a safe bet to take if the company or segment is likely to do well in the long run.

The other metric to look at is the “P/E” (stock price to business earnings) ratio. This gives one a good sense of whether the company is valued reasonably, given how much it is earning as a business. When compared to the “Industry P/E” it gives one a sense of how this particular company compares to the industry average. Typically if it is well above industry average then it needs to be a star performer for the price to keep increasing. On the other hand, if it is well below, then it could either be a genuine laggard, facing a temporary problem, or a new entrant that has not yet been valued at the level it should. In the last two scenarios, it flags a stock that could see significant growth in price.

I typically don’t bother with “dividend%” etc because how much dividend is paid out depends very much on nature of promoters and may not be a reliable indicator of business health.

(In this e.g. you can see that the stock is quoting below the industry P/E and could have scope for catching up by increasing price.)

3. Analyst reports: Within the “quote” tab itself, scroll down to “stock advice and research reports”. This is a good section to get a feel of what the analysts are saying about the stock and the price they are predicting based on expert analysis.

(In this e.g. you can see that most experts are quoting a target price of around 120/- for City Union Bank.)

4. Base financials: Within “quote” again, scroll down to “financials” which is the quick view (not to be confused with the detailed financials tab on the side). Here one can see how the recent Quarterly performance has been, as well as the summary of the “Balance sheet”. Under Balance sheet, look first at how much “debt” the company is carrying as opposed to its “net worth”. In most other cases, a high level of debt is a red flag, especially if it is a significant part or larger than the net worth. What this means is that the company is going to lose a lot of profits to interest payments or debt servicing as it is called. And in the event of a bank crisis (as in the case of KFA) if a call is made to repay loans or liquidate shares, then there will be a crisis if the net worth is low. Of course, there is a strong counter view in the market that all debt is not bad, and indeed, it is important for companies to be holding debt as it indicates they are investing into growth and not being conservative etc. But in India, money is expensive and high debt companies tend to bleed in slow growth environments such as what we have seen over the last few years. It can literally bring great companies to their knees.

Note: There is an anomaly in the case of financial product firms, banks etc that are in the business of borrowing and lending. Their debt will naturally tend to be very high as it is the nature of the business.

Next we can look at the “Quarterly earnings” and the “net profits” per Q and add them up. This gives you a quick view of how profitable the company currently is. Hold the quarterly revenues total in your mind so that you can compare it to previous years revenue later. That will give you a sense whether the sales are growing year on year.

(In this example you can see that the debt is less than 1/4^th the net worth of the company and it is still making around 4% net profit after interest payments. So it’s not too bad, though it seems to be a low margin business)

5. Detailed P&L: Click onto the detailed “Financials” tab on the main dashboard and scroll down to the “Profit & Loss” The very first line on top are the annual revenues figures. Looking at this line will give you a sense of whether sales has been growing year on year. You can also compare the current Qtrly earnings to the previous years.

(In this e.g. you can see that there has been a sudden drop in gross revenues from 2014 to 2015. This may flag a sales issue)

Scroll down on the P&L to “Expenses” and take a quick look whether any of the line items is spiking suddenly. For e.g. if “cost of materials” suddenly spikes, it may signal that raw material has become expensive and this is going to affect the profitability of the company in the future as well. The “finance costs” will indicate how much proportion of the profits is being eaten up by debt servicing etc.

The “Profit/Loss For The Period” line will give you a sense of overall profitability of the business. If margins are thin (as a % of revenue), it may not be a great business to be in even if volumes are high as it may mark commoditization of the category.

(From the above 3 screen grabs, you can see that cost of materials went up between 14-15, while total revenue dipped significantly. This could mean that the company decided to slash prices to compete, or that they produced less while cost of materials went up. In either case, it hits profitability badly, which falls from 245 to 75 crores. Not a good sign overall)

The “Earnings Per Share” (EPS) line is usually my last stop. This is a sort of magic metric that consolidates all the variations and gives an overall health picture. If the EPS is steadily increasing year on year, that is a reliable indicator of a good stock. A share whose EPS fluctuates up and down may be indicating an unstable business while a reducing EPS indicates trouble. Bear in mind however, that EPS is earnings divided by number of shares. So if there is a one-time stock split or fresh issue of shares, the total number of shares in the market will increase and there will be steep drop in EPS from that particular year. This anomaly needs to be adjusted for.

(In this e.g. you can see that EPS is varying wildly yoy, which indicates an unpredictable business that is based on monsoon patterns)

So that’s it then.. these are the 5 steps towards a quick verification of a business’s health. One can go on and on of course… peer review, chart reading, detailed financial analysis so on and so forth. But it is also worth remembering that no amount of data analysis can replace an intrinsic understanding of the business and the segment it is in, because data is always backward looking. For e.g. past data would not have told you 10 years ago that Eicher Motors was going to boom 100x, but if you saw that the wait list for the motorcycle was stretching to over a year and the company was relatively debt free and there seemed to be no competition coming up in its segment, then you would have figured that this is a great bet. Similarly, the other day I heard someone say that he thinks La Opala is a good bet, because as time passes Indian kitchens will see fewer steel vessels in prosperous homes and there isn’t too much competition in the domestic market. While no one can predict the future accurately,  it is also true that such insights will never be thrown up by past data. So it’s absolutely important to marry business insights with data to arrive at intelligent conclusions.  Happy Investing!

(*update- pls be aware of a plethora of niggling quality issues in typical RE style)

Ok, so I finally got to take the Himalayan out on a niceish spin of 600 odd kms, courtesy a friend lending me his bike. And overall I continue to hold the view that this is a good value for money tourer. Definitely worth considering for its simplicity and how satisfactorily it gets the job done. Since much has been said of the bike (with and without the Shimla effect ;), here are just some layman observations I noted down :

Love

• I love the handling of the bike. One of the best I have ridden so far. It inspired confidence across a range of conditions. Regular highway, gravel, wet tarmac, twisties… this is one sweet frame/chassis
• The engine seemed relaxed at all times, though its sweet spot is clearly between 80 and 100 Kph. No worrying sounds emanated even after running 200+ kms hard at a stretch.
• Good stance and ergonomics. While a light and buzzy bike tires you with its restless energy, a heavy & heat generating bike tires you just managing it in Indian traffic (inevitable even on long drives). The Himalayan feels just right.
• Quick enough off the block to keep the commuters at bay and manages to keep up within 10-20 minutes of the bigger bikes in average riding conditions
• Comfy enough for two up riding. In fact the rear preload seemed more tuned to two up riding than solo.
• Lots of useful info on the dash, if we can get into the habit of actually looking at it.

Can live with

• The ugly weld points and general fit and finish. Many bikes report the front external scaffolding or tank being mounted slightly crosswise. The chain guard and saree guard (if u have it on, heaven help you) screws falling off, paint flaking into the tank and blocking fuel lines etc.
• Tall riders can end up knocking their knees onto the front scaffold. Mine did so (on one side only despite my legs being evenly long afaik :)). At the very least it looks suspiciously like a knee cap breaker in the event of a collision. Doesn’t look like much science has gone into its design beyond weld shop jugglery.
• The engine vibes significantly after 100 Kph and isn’t really happy in that zone. One could argue that even the Impulse buzzes along happily at 85 kph and that is a 150 cc bike. So how much more are you getting for double the price and engine capacity?
• If you are used to riding a big bike,then you do miss the occasional joy of blipping past that pretender in an i20, who thinks he is “driving fast”

Hate

• The notchy, hard gearing that chews up shoes unless you’re shifting at high revs. Given that the bike requires frequent gear shifts due to it torque curve, this can be a real bug bear.

As of latest news, RE was recalling and fixing some of these issues free of cost. I did not experience undue heating or rocker noise, both of which are apparently getting a fix. And it seems clutch parts are being replaced for the gearing issue as well. The grapevine says this could actually be a cable / link issue and replacing the cable with a classic or Hero Honda (welll….) cable seems to improve matters

Finally, I find that most folks buying the Himalayan are ex Bullet owners. But I wonder how many of them will really enjoy riding it, because this is a very different animal. Not better or worse, just different! This is not a relaxed, easy going beast that thumps along regally. It’s a free revving, good handling pony that likes to be given a bit of stick. It’s really fun when you shift at high rpms and let that sweet chassis take the twists and road humps at goodish speed. So will the Impulse owner waiting for the KTM adventure, buy the Himalayan and enjoy riding it? That remains to be seen. I personally quite like it, if only they could get those damn gears to slot in neatly.