Financial Education Investing Finance Personal Development Education
Vishal Khandelwal
Vishal Khandelwal

@safalniveshak

10 tweets 70 reads Sep 20, 2022
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Young investors, here are a few qualitative things you may want to know before you start investing your money in stocks.
Grab an apple. 🍎
1. Investing is not risky for the reasons (like volatility) it is made out to be the jargon-filled analysts, fund managers, and other market experts.
It's risky if you do not understand what you are getting into and why. In fact, not investing well is a greater risk.
2. You do not read a high IQ to do well as an investor. In fact, the biggest financial crises have been caused by the highest IQ people.
What you need is good EQ (like impulse control) so as to minimise the mistakes of bad behaviour that causes investors to make big mistakes.
3. To become a decently good investor, you don't need to spend 5-6 or more hours per week worrying about your stocks or other investments. There are better things to do in life.
Become well educated about your investments 'before' you make them, and then let the wheel roll.
4. Investing is NOT about beating the market or your colleague, neighbour, or enemy.
Your main task as an investor should be to protect your capital over the long term and beat 'inflation', so you are able to maintain or grow your purchasing power and meet your financial goals.
5. Unlike what stock market folklore may have led you to believe, high risk does not equal high return.
When you buy good investments at reasonable prices - and you know that well - you are taking low risks that should set you up for reasonably high returns.
6. Legendary investor Sir John Templeton said, β€œThe four most dangerous words in investing are 'This time it's different.”
It is 'never' different. Booms and busts happen in almost the same way, and investors lose money when
they start believing that β€˜this time it’s different’.
7. 'Diversification is for losers, you must concentrate,' is an advice I received in the early part of my career.
It is bad advice for most new investors. Concentration can make you big money, but has huge risks that only unfurl with time.
Diversify enough. Not too much.
8. You are likely to succeed as an investor not just by the stocks you own, but more importantly by the ones you don’t.
Create portfolios like a museum curator (choose well), not a warehouse manager (choose everything).
12-15 stocks + 3-5 funds are enough. You don't need more.
9. What you need to succeed as an investor is your independent thinking.
Remember, you alone are the most capable person alive to manage your money. It’s high time you start believing this.
Educate yourself well. Then choose your investments well.
You have my best wishes. --

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