Prediction of stock market rally after Lok Sabha Election Results creates frenzy but investors must remember this key point
economictimes.indiatimes.comstock market would set new records on 4 June, when the election results are declared. A certain breed of trader, who lives by the proverbial ‘tip’, has latched on to it with glee. In fact, a whole lot of people who are interested in stock investing, but have not yet taken the plunge, have suddenly woken up, so to speak.
A friend of mine desperately looking for some guidance on how to start investing is now convinced that he must invest as much as he can before 3 June.
It’s funny how a single statement can set off such a frenzy. Suddenly, everyone’s inner Warren Buffett is emerging, and even a person who has never looked at the stock market, is an enthusiastic fan. While the excitement is contagious, it’s probably a good idea to remind my friend, and myself, that investing isn’t a race.
It’s more like a marathon where slow and steady often wins the game. So, maybe, we should take a deep breath, conduct a bit of research, and not just dive in because of a hot tip, no matter how exalted the source of this tip.
In fact, this attitude reminds me of a famous Buffett quote from the 1997 letter to his shareholders. “A short quiz: If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef? Likewise, if you are going to buy a car from time to time, but are not an auto manufacturer, should you prefer higher or lower car prices? These questions, of course, answer themselves.
