More and more traders are being wiped out every single day as markets move up and down like a bouncing rubber ball. A trader I know was telling me how trading is a game where 99% of people donate their money to 1%. If you belong to the elite 1%, trading is great. However a lot goes into being a part of that 1% and not everybody will be a part of that 1%. Very few people will even get access or know such traders as they are extremely secretive and low profile. I like giving a part of my money to that 1% as I don't have the time to trade and I feel I don't have the mentality needed to trade successfully.
I have been having conversations with a few investors in international markets to understand what is happening better. From what I hear from them, America and the West will be affected very badly and still there are a lot more losses to be revealed. This will lead to a global slow down which will eventually run into commodities causing things like crude, metals, cement, etc. to all fall drastically. In India financial institutions will surely be affected by this and so will other businesses, however the affect on India will be much less purely in terms of economic fundamentals, however it can cause markets to correct as foreign investors will pull out money to save themselves. Personally I feel that this will be a great opportunity as with the rise of products like ULIPs/Insurance and Mutual Funds over the next 5 years, lots of local money will be coming into our markets.
As Laxmi Mittal's company ArcelorMitaal says Boldness Changes Everything. Boldness made Laxmi Mittal one of the richest Indian's in the world and the richest man in Europe. I shared his inspiring and motivating story with all of you in ITHW because I felt we investors can learn priceless lessons from entrepreneurs like him. In fact now is the best time to make use of the ideas you read about in ITHW. It seems the number of people wanting to buy cakes is reducing each and every day. The baker has no choice but to offer things cheaper. Now is the time to be bold because everyone else isn't. However being bold doesn't mean going and buying 100%. It doesn't mean buying based on rumors without research and knowledge. Being bold doesn't mean being crazy and suicidal. Buying 100% at one go, according to me is extremely risky because it doesn't let you benefit from future opportunities. Instead buy gradually into companies you like, I for example bought more into one of the companies I shared earlier which wouldn't be too affected by the international economic challenges. While reading my post there, you will notice how the same companies which had shot up over 20% within a matter of weeks are once again much lower. In fact almost all the companies shared earlier are much lower today in terms of stock prices. A few of you had written to me that time telling me how you regret not buying, but I had simply told you that don't worry about the stock prices and spend time learning. Opportunities will come if you have patience.
As Warren Bufett, the richest man on earth, says:
"Interpreting market volatility as a destroyer of opportunity when it is instead a creator of opportunity. If your approach is sound then volatility allows you to buy that which was cheap yesterday cheaper today"
Do you agree or disagree? Share your thoughts in our Comments section. I would love to hear from you.
Also several of you have been asking me about Exchange Traded Funds (ETFs). I shall be sharing my views on them shortly, however till I do that you can find out more about them by going through the FAQ at Benchmark Fund's website. I had met their executive director Sanjiv Shah, sometime ago and I found their fund quite interesting.
Have a great weekend and make the most of life and the opportunities life gives you!
Read the wonderful thoughts shared by fellow Happionaires on Politicians and the theory of Karma.