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The Olympics Of Investing

Investing is like the Olympics. If there is passion, perseverance and the right process, the results are rewarding

Photo Credit : Shutterstock

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The recently concluded Olympics witnessed contrasting emotions. First, things did not begin well, and soon familiar stories of failure started to emanate — lack of focus on sports, inadequate planning/infrastructure and official antipathy. But finally, came some good news; stories of planning, perseverance, passion and performances were appreciated and rewarded with the whole nation’s adulation and material rewards.

Investing is like the Olympics. If there is passion, perseverance and the right process, the results are rewarding.

The stock markets make for an extremely competitive arena. There are over 4,500 listed stocks and over 400 equity mutual funds and just a handful of winners (though unlike the Olympics, there can be more than three winners). It is very important to plan your play, and play your plan. When participating in the Olympics of investing, the first thing to do is to set a goal and plan a strategy to achieve it. It takes hard work, painstaking research and practice to identify wealth creating companies. But the most important thing is to have a plan, and the patience to adhere to it.

Olympic champions are not made in stadiums, but on the training ground. Only if you have a strong investing process that you repeat again and again, will you see good performance results on the big stage. In investing, as in sport, process leads to performance. Following a robust investing process for days and years ca create a champion portfolio. If you are a savvy investor, you can do this yourself. Else, you can seek help of an advisor or fund manager.

If you don’t have a passion for equity, you should not enter the stock market. It needs an appetite for risk taking. Don’t go by tips. Tips are for gamblers. If you invest in quality companies and persevere with them through their growth cycle; you reduce the risk of losses as well as increase your chances of better returns

And lastly, you can’t win the Olympics of investing without the right K.I.T. i.e., knowledge, integrity, and team.

In investing, it pays to know more. While the information available is unlimited, the limiting factor in acquiring it, is you. You need to constantly seek new sources of information to enrich your mind. Legendary investor Warren Buffet spends about 80 per cent of his working day reading and thinking. In my own company, the cornerstone of our business is research. We invest substantial resources to ensure that knowledge gives us a real edge in a globally competitive business.

Knowledge without integrity would be like a car without a steering wheel and brakes. It wouldn’t work, and if it at all does, it could be dangerous. To be an individual with integrity, you must honour your word. If you have committed to working towards a process, you must. Integrity will help you to persist on your journey to investing glory.

Often, what you are unable to achieve on your own, you can as a team. In investing, it is a good practice to network and share thoughts with like-minded investors and financial advisors. This cross pollination of insights could lead to your next big investment idea.

In equity investing, the rewards outweigh that of any other asset class. If you are successful, the upside is unlimited; way more than investing in fixed deposits or gold. Equity rewards are the real gold medal in the game of investing!

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.


Motilal Oswal

Motilal Oswal, Chairman & managing director, Motilal Oswal Financial Services

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