Simplified Laws Guide to Taxation and Legal Concern Family get-togethers facilitate talking to your kith and kin. It used to be a wholesome talking venue in the past. Now, half the time, most of the people are busy browsing their mobiles. On and off we do talk on dry topics like rain (too much rain this year!), weather (too hot this summer!), elections, etc.
The new theme is Stock Markets! Did you notice a group of people chew over stock markets in such events? I am amused to listen to their conversation. This short note is dedicated to them!
These set of people have something in common, a few of them are –
Small investments and big talks: These people are usually petty traders or invest paltry sums. Yet, when you hear them talk, they sound like stock punters! Remember, those who invest lots won’t talk much. They invest and follow silently.
Growth in Percentages – They never talk total volume of profits. Instead, they say, I made 58% profit in Infosys. I asked one of them (shamelessly) how much he had invested? He said, Rs.22,000. Come on, even if it goes up 580%, what difference does it make in terms of total money! Contrarily, a good investor will put 50 – 60% of his net worth in equities, shut his mouth and sit tight.
Lack of knowledge – These people have no idea of financials. They read bits and pieces through forwarded WhatsApp messages or shared tips or TV news and quote them loudly (did you observe when people know little, they raise their voice, tell it loudly!). They talk about PE Ratio, Dividend Payment, etc., all hollow.
No idea of business – Recently, I heard someone talking about Endurance Technologies Limited in one of the functions. They were saying it as an IT company. (Fact – it is an auto component company). They were also saying Hindalco is a Public Sector Undertaking. (Fact – It is an Aditya Birla Group company). Without knowing the head and tail of business, they promise double-digit appreciation in short term, if invested!
Strong Predictions – These folks claim to predict the movement of stocks correctly. They say, just before the crash they sold, and they ride on the rise! The perfect algorithm is with these guys. In contrast, a wise, seasonal investor will never be able to predict or time the market. They invest, rebalance it, and hold on for very long years.
Quick Exits – These breeds exit too early from good stocks and stay put for too long in bad stocks. But they don’t agree on this. They say they are learning a lot from the stock market year after year.
Bank on tips – They bank on YouTube videos, TV news, message tips, WhatsApp Group chats so on and so forth. They don’t have anything original. They consider that investing in stocks or trading is fun and it gives ‘side/extra’ income. Contrarily, a serious investor will not work on tips. He builds a strong portfolio and holds on to it.
Do you participate in such a discussion? If you are taking it lightly for fun or entertainment, then enjoy. If you are getting trapped on such a business idea, then try to change the topic. Maybe election, education, IPL, Boris Johnson’s hairstyle, etc., is a better alternative talking point.
