When the going is good, investors tend to get overly excited. Like a carnival where there are elements to excite you just as you enter the venue, the stock markets have different elements that keep the buzz and excitement up. In the midst of all the noise, din and hype, it becomes challenging to stop yourself from joining the fun and soaking in it fully. To even think of pausing and leaving the happening place is extremely difficult. The Indian markets seem to be going through such a moment. Investors want to be in the thick of the market action. Money is finding its way into IPO’s. New issues are lining up to lap up public money. Listing is now a happy lottery. Whatsapp groups are buzzing with hundreds of stocks begging to be bought. Everybody sees only positivity coming out of corporate actions. One hardly sees sell recommendations from brokerages. Risk seems to be a bad word in the Indian markets right now. In times like this, a bit of counter intuition would be just right. While one isn’t yet at that sell and go away moment, it surely is a good time to take fresh stock of every investment decision and to clinically reason out their sustainable merits. Time to pause and think hard.
A reserve of cash and loads of patience are central to intelligent investing.