'At no point risked more than I could afford to lose': Remembering Rakesh Jhunjhunwala

Known for taking outsized bets, Jhunjhunwala has suffered a few reverses in his trading career of over three-and-a-half decades

Moneycontrol revisits the investing philosophy of late Rakesh Jhunjhunwala on his first death anniversary.

“A risk taker at heart” is how the late Rakesh Jhunjhunwala used to describe himself. At the same time, Jhunjhunwala said that he would risk only what he could afford to lose.

“If I had Rs 100, I would risk 20,” he said in an interview on CNBCTV18 in 2020, on his 60th birthday.

“I haven’t ever risked so much that I could not live to take another risk. I have learnt (and am learning) from my losses. The biggest mistake would be not learning from them,” he said in the interview with long-term associate Ramesh Damani.

Known for taking outsized bets, Jhunjhunwala has suffered a few reverses in his trading career of over three-and-a-half decades but managed to stay in the game and come back even stronger. Jhunjhunwala said that he went heavily long in many stocks in June 2002, thinking the market had bottomed out. But his bet was wrong, and Jhunjhunwala had to exit his positions at a steep loss. And since he had built the places on borrowed money, he had to sell 25 percent of his long-term holdings to repay the money.

However, Jhunjhunwala said that the fear of losing wealth never deterred him from taking risks in the first place.

“Even if my wealth becomes 20 percent of what it is, I'm going to drink the same whiskey, drive the same car, (my wife) Rekha and I are going to go for the same holidays… so it's not going to make much difference to us in our lifestyle,” he explained.

At the end of the day, Jhunjhunwala said that he wanted to be able to do what he enjoys and wanted to enjoy what he was doing. “It is the thrill of taking the risk and being proven right,” he said.