Avoid ‘get-rich-quick’ approach and be a long-term investor
In recent years, the means or channels to reach investors have increased. Investors who are overpowered by greed fall prey to shenanigans that offer them the lure of assured returns. Shenanigans promises to offer 3-6% assured returns per month on investments in the markets. They use social media to showcase the high returns they make. Many times, they use manipulated screenshots to deceive naïve investors.
It is unfortunate that despite so many investor awareness initiatives carried out by the stock exchanges, the financial market regulator, and other stakeholders, some naïve investors fall for the claims. Such occurrences can drastically impact investors’ confidence in the financial markets.
Investors must get two aspects right while investing in the markets. Firstly, stocks do not guarantee returns. No money manager can guarantee returns on stocks. The financials of a company are never steady and sometimes businesses fail. Stock prices react to such things and broad macroeconomic variables. So, be reasonable. In the long term, stock prices follow the earnings growth of companies. A well-managed portfolio of large-cap stocks may offer around 12% returns in the long term. But again, this is not a guarantee.
The second thing about investing is selecting the right entities to manage one’s money. Investing in stocks is a specialised skill. Hence, one must select regulated investment vehicles such as mutual funds, portfolio management services, and alternate investment funds to invest. These investment vehicles are
