Saturday, January 10, 2009


The so-called 'investor' is a rare find. How many investors actually pore over a company's finanicals before making a decision to buy its equity? Most retail investors say: "I feel . . .", "O ! This is a rock solid company which has so many retail outlets", "Have you seen the size of that refinery? It is the biggest in the world!!! (Must be good).
Completely irrational investments where they themselves are to be blamed. Finally, when a scam is unearthed, or when the numbers are inferior to competitors' the stock price falls and the 'investor' blames the promoters. "Those SOBs! They should be paraded naked!! Why did they do this? I always thought something was wrong."

Human behaviour is fantastic, which has always intrigued me. We are quick to blame, anger, love, and depress.

Handing over your money to a fund manager or a mutual fund seems apt - and that may be called 'investing'. Here again, not much research goes into how the fund reaches its decisions but an investor's decisions are based on trust. A trust which says - capitalism rocks!
Competition forces a fund manager to do all at his disposal to outperform the rest. One blunder big enough and the fund house may fall low for quite a while. Therefore, an investor has to believe that, as long as the portfolios are transparent, his money will be invested after adequate deliberation.

Fear and Greed - the 2 will always belong together.

It is true that man loves to talk and talk especially of things he does not know of. Adding 20% to 180% to a story is part and parcel of social conversations. Emotions run amok and facts are accentuated. Ego drives decisions and the chitter chatter. I want to appear smart! I want people to remember me! I want to be the center of attention! I want accolades!

There is not a day that passes by when I have not not laughed or smiled at a fellow human being. One of the perks of beign an outsider (Or so I believe ;-) )

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