Skip to main content

What stock market is not?




The idea behind this piece is to share thoughts on what stock market is. Well then, I thought why not use the principal of inversion and explain what stock market is not. It is easier to explain what it is not and helps me use the simplicity principle.

Let’s dive in:

Not a get quick rick scheme: In no way is the stock market a place to get rich quick. If anyone tells you otherwise do yourself a favor and avoid listening to that person. Just hammer it in your mind that if it were so easy everyone would become rich overnight. Think about why the person is sharing the tip with you if it really works & is easy. It takes a lot of patience, courage, knowing yourself and hard work to build wealth. Above all it takes time.

It is like watching the seeds you sow grow into a plant and bear fruits. The road is bumpy and time consuming. It will test you every now and then. It is akin to building a house where you have to lay a foundation (investing philosophy), lay brick by brick (additional capital & reinvestment of profits) and cement (patience to hold).

Not akin to Gambling: Investing is far from gambling because it is the house that always wins in gambling unlike investing. You don’t blindly put your money in companies as you do in gambling betting on numbers. You have to have some process and conviction to bet big. No, X told me to invest in this company and he is my friend I trust him doesn’t work.

Your money is your responsibility because both upside and downside would affect you and your family only.

Not a place to get yourself some entertainment: I feel so excited I have invested 50,000 in XYZ script. I am so happy my stock moved 10% today. I had spare 50,000 let me invest in penny stocks what the worse that could happen. If this your thought process before investing please donate the money give back to the society at least it will have some utility.

It is better to go gambling if entertainment is all that you want and it is okay as long as you only take a small portion that you can afford to lose for gambling.

 

Ps: I was having a hard time thinking about a topic to write on. Spent entire week but couldn’t come up with anything. I got this idea while I was out on a run. So a pro tip if you’re finding it difficult to get ideas or work go out in the nature run or walk or simply stare at the sky you might stumble upon something.

Similar reads

 https://investingreel.blogspot.com/2020/07/markets-life.html

https://investingreel.blogspot.com/2020/07/investing-like-long-distance-running.html


 

 

Labels:

Comments

Post a Comment

Popular posts from this blog

Help to get Helped

Do you remember how you felt when someone out of the blue helped you without asking for anything in return? Let me share one of own experiences when I was on a job hunt in my final year of post graduation. There was a senior of mine who graduated and we were not connected. Now as far as my memory serves, I was good with him but don’t remember him helping me in any manner. He helped me connect with 3–4 companies, without me even asking for help. He reached out to me and was constantly helping me during the process of applying & interviewing. Did I land with a job he helped me apply with? Yes, I did (ended up not joining because of some other reason) The point I want to highlight here is it was very pleasing to be helped by someone in a tough process, I was shooting 5–10 mails on some days just to get an opportunity. I am grateful to him. Now, I don’t know why he helped me but I know that it taught me a big lesson in life, “help someone for no reason and without expecting ...
Post a Comment
Read more

Interesting Perspective on Investing

  I came across a post by Ensemble Capital this week which gave me a unique way to view investing. I obviously couldn’t stop myself from dissecting it and presenting you my views on the same. Investing is intrinsically a natural act of providing resources to an organism operating within an ecosystem . Investing is a form of participating in the living ecosystem in which the human race organizes itself into groups and then engages in both competitive and cooperative value generating behavior . Source: Ensemble Capital Blog Before you ask what do they mean, let’s look at what we as living organisms do. We take birth, learn about this beautiful world, get education, work to pay our bills, fulfill our responsibilities and leave the world one day. In this process just like the nature provides us with resources we as investors provide business with the resource (money $$$) we have. Similarly just like we coexist in an ecosystem along with other organisms so does a business coexisting w...
Post a Comment
Read more

Are you Biased?

We are all biased!! Yes, I said that out loud, we all are. It includes yours truly too because I am no exception. Let’s define what bias means before we delve into different types of biases. Wikipedia defines bias as “disproportionate weight in favor of or against an idea or thing, usually in a way that is closed-minded, prejudicial, or unfair”. Biases stem from the way our brain is structured to help us. Our brain always tries to keep past experiences in mind, remembers what gives us pain or pleasure, what worked to give us recognition or what led to failure, and tries to make sense of the present and future decisions based on them. So, the brain doesn’t recognize that it could be a bad thing for us. Biases make us irrational in our decisions and choices. Now almost none of us can eliminate biases because its difficult to recognize the bias when you’re actually being biased because your brain tricks you into believing that what you’re doing is the right thing to do. ...
Post a Comment
Read more