As the markets have turned shaky, the panicky kind of investor................ 'story of the world's worst market timer'.
There was this hypothetical investor who always gets going when the markets have risen far and hard and thus ends up buying at the peak, just before a crash comes. However, he doesn't sell when the markets crash. In the US, this person would invest in the stock markets in 1973, 1987, 2000, and 2007. Each time, soon after investing, a crash in the markets would wipe out a good chunk of his returns. Over this long term, he would still make decent returns.
I checked out how such an investor would fair in India. He would invest in 1986, 1992, 2001, and 2008, catching the four great peaks the Indian stock markets have seen. In each case, a major chunk would soon get wiped out. If he had invested a constant amount, the returns would be decent one, turning the money about 50X!
The moral of the story is that in a growing economy, timing the market is irrelevant--what matters is staying the course.
Conclude with Common reaction of Retailers or Investors
Question running behind mind is "When ever do big investment..the market starts crashing"
My View: "SIP / Level based partial Accumulation" is best way to create Wealth to ignore short term market movements.
Disclosur: Information shared here can be my view or real trades.
As i am not SEBI regd. analyst, Take this information as study/education purpose only.
If Useful Like & Share
For taking trade decision Consult with financial Advisor.
There was this hypothetical investor who always gets going when the markets have risen far and hard and thus ends up buying at the peak, just before a crash comes. However, he doesn't sell when the markets crash. In the US, this person would invest in the stock markets in 1973, 1987, 2000, and 2007. Each time, soon after investing, a crash in the markets would wipe out a good chunk of his returns. Over this long term, he would still make decent returns.
I checked out how such an investor would fair in India. He would invest in 1986, 1992, 2001, and 2008, catching the four great peaks the Indian stock markets have seen. In each case, a major chunk would soon get wiped out. If he had invested a constant amount, the returns would be decent one, turning the money about 50X!
The moral of the story is that in a growing economy, timing the market is irrelevant--what matters is staying the course.
Conclude with Common reaction of Retailers or Investors
Question running behind mind is "When ever do big investment..the market starts crashing"
My View: "SIP / Level based partial Accumulation" is best way to create Wealth to ignore short term market movements.
Disclosur: Information shared here can be my view or real trades.
As i am not SEBI regd. analyst, Take this information as study/education purpose only.
If Useful Like & Share
For taking trade decision Consult with financial Advisor.
