Don’t Lose Money in Stock Market

Rule #1: Don’t lose money

Rule#2: Don’t forget rule #1 – Warren Buffet.

Indian stock market is as confusing as the coronavirus. The stock market is the most dangerous place for the people who think they know but, in reality, they don’t accept the fact – they know nothing. Yes, we are all Jon snow but, we haven’t figured that out. Just like the Indian economy, our stock market is dependent on foreigners.

Why retail investor lose money?

Retail investors lose money because of higher expectation and don’t know the rules of the stock market. When it comes to investment, behaviour management is crucial because people become traders from investors in just a few seconds. Retail investors tend to look for quick money and, beginners luck helps them however, it does not last long. When reality hits they will be looking for the downward hill without breaks.

Warren buffet is the wizard of the stock market and, people follow him but, they don’t follow his patience. And, he has made the majority of money after the age of 60. That’s astonishing. People don’t have the stamina to last longer in the stock market.

Every newcomer in the stock market thinks that he will become super rich just like every middle-class Indian believes that he can become super-rich and what they need is – the secret. They look for secret but find nothing. Finally, the illusion of becoming rich shatters and, they blame it on luck. In the end, blame everything on luck or system to getaway.

It’s not that retail investors don’t make money in the stock market. We have recently witnessed the once in a lifetime incident of the rise and rise of the Gamestop corporation. Wherein a bunch of retail investors took on the giants. The first time the giants bled and, the reaction was obnoxious. That shows that power still resides in people – not in the giants. If the bottom decides then, they can bring down anyone. However, it is not all rosy picture, many retail investors also lost money, so retail investors must avoid falling into a trap.

Retail Indian investors in the stock market are short-sighted. Many people start investing in the stock market post watching scam 1992 wherein the antagonist portrayed as the protagonist and, that’s what Indians need – magic, drama and a compelling storyline to fall.

Thanks for reading.

Image source: Pixabay

32 thoughts on “Don’t Lose Money in Stock Market

  1. In any business there is a risk involved if you don’t know the business , like any job you dont know the job you are out. The same rule applies here, know , learn then invest. And the market is of more of retail investor, youngsters who are investing and learning thanks to internet and application 🙂
    People who want to be rich overnight they loose money , long term investors do make money .
    As an amateur investor myself am just here to say the other side of the story 🙏🏻

    Liked by 5 people

    1. True…Any business completely runs on strategies, accompanied by risks and uncertainties.
      To earn profits in any kind of including stock market business, one has to mindfully invest and trust on justified and practical advices based on facts…Long term investors who holds the stocks of technically well company do earn well. So we can certainly say it’s highly dynamic but people playing with proper facts and justifications do earn well.
      Most importantly, it’s very important for freshers in stock market to understand that stock market is not gambling that we could earn and become rich overnight. It’s very important to create an awareness that stock market plays on strategies.
      #risks are involved in every aspect of life.
      Life is itself not certain.

      Liked by 3 people

  2. I think people need to detach the word investors and traders as the same thing.
    While it is true they both try to achieve the same thing in the stock market. Its like comparing apples and oranges. Warren Buffett is a great investor. He understands the fundamentals and the business economics. He does not simply see price.
    Investors purchase stock as taking an ownership in a business. Its for the long term. Retail traders that buy purely on price speculation are different. As you can see in the Gamestop fiasco. Behind all the drama there are many that understand the technical components (especially with derivatives). But there are many more just following the crowd and hoping to cash in quick.
    Great blog post. Enjoyed reading it!

    Liked by 4 people

      1. Can you pls tell that we all are very much unknown about stock market if we talk about normal case so it must be a part of school curriculum so one can get a basic knowledge ?🤔

        Liked by 2 people

  3. Schools in the United States don’t touch on investing as much as I think they should. People are caught up on the excitement of becoming a millionaire over night. What I find exciting is that if I start investing now at the age of 19, then I’m more likely than not to have all the wealth I’ve ever dreamed of when I’m 40!

    Liked by 1 person

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