Pillar guide · 13 modules · 2 paths

Behaviour and business analysis

The two things that ruin most investors. First, your own brain. Loss aversion, anchoring, overconfidence, recency bias, herd behaviour. Second, a shallow understanding of what actually makes a business durable. Moats, capital allocation, management quality. This pillar addresses both.

Why you are your biggest risk

If you are honest with yourself, most of your largest losses came from your own decisions, not from bad stock picks. Selling in a panic. Holding a loser to "avoid the loss". Chasing a winner after it has already run. Ignoring contradicting evidence. These patterns are predictable, universal, and well documented in behavioural finance research spanning decades.

The Path 8 modules are not abstract theory. Each one names the bias, shows how it expresses itself in Indian markets with concrete examples, and gives you a systematic countermeasure. Most of those countermeasures involve rules that pre-commit you to behaviour before emotions kick in.

Path 8 · Module 1

Why investors lose: introduction to behavioural finance

The gap between rational investor models and how people actually behave with money.

Path 8 · Module 2

Loss aversion and prospect theory

Why ₹10,000 lost hurts more than ₹10,000 gained feels good. Kahneman and Tversky's framework.

Path 8 · Module 3

Cognitive biases: overconfidence, anchoring, recency

The three biases that most often ruin Indian retail investors.

Path 8 · Module 4

Herd behaviour and market bubbles

Why bubbles form and why you cannot trust your sense of "this time is different".

Path 8 · Module 5

Disposition effect and how to beat it

Why you hold losers and sell winners. Systematic rebalancing as the fix.

Path 8 · Module 6

Building systems that protect you from yourself

Concrete rules, checklists, and automations that pre-commit you before emotions strike.

How to actually analyse a business

Even systematic investors benefit from understanding what they are investing in at the business level. Factor strategies rank stocks using data; business analysis tells you whether that ranking is capturing something real or something transient. Seven modules cover the essentials.

Path 9 · Module 1

Competitive moats: understanding durable advantage

Network effects, switching costs, cost advantages, intangibles, scale. Indian examples.

Path 9 · Module 2

Revenue quality and earnings quality

Distinguishing sustainable cash generation from accounting earnings.

Path 9 · Module 3

Capital allocation: the most important skill

How CEOs deploy cash, and why this single decision drives most long term stock returns.

Path 9 · Module 4

Leverage, debt, and financial risk

Debt-to-equity, interest coverage, refinancing risk. When leverage kills.