Investment University

Investing at its heart and soul is avoidance of the big loss.

We, at First Global, look at risk management as a central tenet of our investing process.

While there are quantitative ways to manage risk, this blog post, we want to talk about how to qualitatively manage risk in your portfolio.


Therefore, qualitatively speaking, these are the major risks that you should avoid in your investing journey.

"Storification" risk: when you build a nice story around your Investments, a story that you fall in love with. The risk increases even more when you tell others about this story, as this makes you want more emotionally invested in it.

"Concentration" risk: when you put most of your eggs in one or a few baskets.


"High Conviction" risk: when you get hyper convinced of your investment hypothesis and take large positions in your High conviction ideas.


"Investment Philosophy" risk: when you make some of your investing successes into an investment philosophy, forgetting that many successes in the stock market are random, and based on nothing but good fortune, or being in the right stock at the right time.


All the above are classic investing biases. 

They create rigidities. 

They reduce flexibility.

They make you emotionally invested in your holdings which make taking rational decisions that much more difficult.

Rigidity in anything is avoidable (except in Risk Management, that is).

Rigidity in arteries.

Rigidity in muscles.

Rigidity in thinking.

All completely avoidable, like plague.

We, at First Global, keep our Investment Strategy data-based. Situation based.

We have no rigid philosophy. 

We adapt according to the changes in the markets, the developments in the world.

Marry these with Zero-emotion, System-Driven Risk Management.

That's the First Global Method.

More on our (Hu)man + Machine Investment Model in our subsequent posts.

From the desk of 

Shankar Sharma & Devina Mehra

If you want any help at all in your wealth creation journey, in managing your Investments, just drop us a line via this link and we will be right by your side, super quick!

Or WhatsApp us on +91 8850169753

Chat soon!

https://firstglobalsec.com

  • Socialise with us at :
  • Image result for facebook logo

Tell Us What You Think:
Accolades & Happiness Under Management

First Global has been widely commended by Global Media. And by thousands of big & small investors worldwide

Subscribe to our fun & thought provoking articles

Contact us on ([email protected]), to get cracking on building serious wealth!

Follow our buzzing social media handles