'When your investment works for you, you do not need to work so much'

Over the past one year, as the markets have witnessed a massive rally, both SBI Bluechip and SBI Magnum Midcap have delivered superior returns. We speak to Sohini Andani, who manages these funds at SBI. She shares with us her thoughts on market valuations, impact of the second COVID wave, momentum investing, among other things. She also shares the philosophy she follows for managing her funds. As an investor, tell us about yourself and the key tenets that influence your thinking. I joined the markets in 1995 at a time when I had not even completed my studies. My interest in stocks goes back to my college days when our college professor used to bring annual reports to the classroom and asked us to analyse them. That evoked my interest in stocks and the way businesses were run. At KRChoksey, where I started my journey into stock markets, it was a very good learning experience interacting with Kisanbhai, who himself was a very good long-term investor, apart from providing research to a very broad set of clients. So, very early in my career, I started looking at portfolios, how they were built and how businesses were selected. It helped me cultivate a long-term approach to investing and a belief in the power of compounding. That played a big part in how I think about stocks and explore the possibility of a long-term compounding story in any business that I have invested in. Once you find such stories, you simply remain invested in them for five to 10 years or more and continue to reap the benefits. So, I think that is one tenet that I developed very early in my investing journey. Another very important focus area for me is capital allocation - how promoters are allocating capital, how wise their decisions are and whether they generate returns in excess of their cost of capital. Only those businesses that can generate returns in excess of their cost of capital over a long period can create value for the investor in the long term. That is a belief that came in quite early and it has stayed on. And I would say that that consciousness has been of great help in the way I have been investing. Do you recall some key lessons or incidents that have had a big impact on your career right from your days with Choksey? For i