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