We often get caught up in anecdotes of people who got rich because their parents or grandparents had bought shares of Hindustan Unilever, HDFC, etc, because that small investment has now grown into a nice little nest egg.
Then we start to regret the fact that our parents did not start investing in the stock market a few decades ago instead of sticking to FDs, as that would have provided us with retirement money.
In reality, it would have helped us far less than we think!
This was brought home to me recently when a client shared his mother's portfolio that had remained nearly untouched for 20 years and what did I find there: no HUL, no HDFC Bank, not even an ITC...instead there were DSQ Software, Silverline Technologies, NEPC Micon, etc.
You may say these are purchases during a particular boom but the issue is not as narrow as that.
Even the Sensex companies of decades ago were weighted towards textiles, shipping, paper & pulp, old car companies etc.
Scindia Steamships, Hindustan Motors, Ballarpur Paper, Zenith, etc were the blue chips of the day that our parents would have likely bought had they been in the stock market then - that have largely faded into oblivion.
Most examples of the great returns from 'buy and forget' suffer from Survivorship Bias.
Of course, that isn't the only place where Survivorship bias misleads us - but more on that another time.
From the desk of Devina Mehra
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Economists Think Dollar's Fall May Explain the Recent ‘Rally’ by Steve Liesman
Einstein taught us about relativity in nature. Now come Devina Mehra and Shankar Sharma of First Global to teach us about relativity in financial markets -- and raise some serious questions about just what is driving stock prices.
First Global reports are quite credible and, on occasion, more than that.
What prompts this mention is Intel's earnings report and the fact that First Global has had a pretty good bead on the company and its stock.
AMD up again following First Global upgrade to ‘buy’ (AMD) By Tomi Kilgore
Analyst Kuldeep Koul at First Global upgraded Advanced Micro Devices (AMD) to "buy" from "outperform," given the "exceptional traction" that the chipmaker's Opteron line of processors has been able to get.
Baidu Climbs on First Global’s ‘Outperform’ Outlook
Baidu Inc., the operator of China’s most-used Internet search engine, rose to the highest price in two weeks after First Global rated the shares “outperform? in new coverage.
Personality counts: Walmart's frugal, but Target charms
"It's better to take a slight hit on [profit] margins and keep on moving and inventing," says First Global Securities. And at least for now, Target is inventing in a way that appeals to consumers with money to spend.
Dead Batteries
At 11 times trailing earnings, Energizer is cheaper; Gillette's multiple is 25. But cheaper doesn't mean better, says First Global.
Bipinchandra Dugam @bipinchandra90
@devinamehra @firtglobalsec
invested in both GFF-GTS and Super I50. Thank you very much for such wonderful investing experience with completely new approach. In my 15years of investing first product I felt which close to what customer want.
Shishir Kapadia @shishirkapadia1
@firstglobalsec @devinamehra
by far you are the best, I have not come across transparency, acumen, global expertise, exposure, protection of capital, delivering return from any fund/ fund managers. Invested very small size in 3 products will keep on increasing it over the period
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