Did Skin in the Game Matter for These Jewellery Stocks? - Chart Of The Day 4 May 2018 - Equitymaster

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Did Skin in the Game Matter for These Jewellery Stocks?
May 4, 2018

Mind you it is not always that smaller companies with owner operators do a better job of creating shareholder wealth.

Rather, I believe this advice from Warren Buffett is most suited to small owner operator companies.

  • You should invest in a business that even a fool can run, because someday a fool will.

Take the case of Titan and PC Jeweller.

Titan has been professionally managed for decades. PC Jeweller is more of an owner operated company.

Investors treated the two stocks very differently post the Nirav Modi - PNB scam and the Vakrangee scam. If nothing else, the management transparency and corporate governance of Titan won it the confidence of investors and steep valuations.

PC Jeweller, meanwhile, has lost 70% of its market cap in past three months.

Investing in safe stocks is not as easy as it looks.

Data Source: Ace Equity

This Chart Of The Day was published in The 5 Minute WrapUp - Infosys, ICICI, Indigo and CEOs Without 'Skin in the Game'

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