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Monday 15 March 2021
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A Mom’s Lessons for a Son and an Investor

By Yamini Sood

Do not get bogged down by what your friends do or don’t. You can’t be defined by others. Try to build your own thoughts. Don’t seek affirmations and confirmations from all. A handful of well-wishers are all you need.Trying to please everyone can be suicidal for your personal growth.

Likewise, in investing, do not buy or sell based on what your friends, neighbours or that fancy stock guru is buying. You do not know their realities. You do not know their risk appetite, information ratio, manoeuverability, asset allocation and incentives. Actually you know nothing about those you wish to imitate.Robert Cialdini described this behaviour as `social proof ‘. It is the tendency to see an action as more appropriate when others are doing it. It may not always be the best for you. Do not be in a hurry to grow up. You are always asking when you will get independent, when you will make money , when you will be involved in discussions we adults take part in.Some things take time. Growing up is a process. Enjoy it. Your science book explains how a seed turns into a sapling, then into a shrub and later into a tree. Some seeds wither away , not all turn into a tree and bear flowers and fruits. We nurture, support, love and sometimes admonish you-it’s all a part of growing up. You may not realise it, but at every stage you have a set of responsibilities, independence and authority . If you keep comparing yourself with us grownups, it will only add to your misery .

As an investor, do not be in a hurry to see your investments grow.Investing is a process. It is not a journey towards building an X amount of retirement corpus, but a journey to achieve financial independence.The sooner you achieve it, the better.Not all investments will pay off. But all’s well if it ends well. Worrying over every investment will only make you miserable.

Do not wile away your time. All play and no work got Jack nowhere.Remember the ant and the grasshopper’s story? The one about the ant that worked tirelessly through the summer while the grasshopper played, sang and danced, only to learn the value of hard work when winters arrived? I want you to twist the story a little. Be the ant many times but do be the grasshopper sometimes. The fine balance is difficult to achieve, but then who said life was easy? Also, don’t be careless. careless.

Likewise, in investing, average investors can only earn a finite amount. There is no substitute to growing wealth but by saving more. Do yourself a favour, watch two bad movies less in a month, skip an expensive meal at times and put that money to good use. Take care of your mon ey, because if you don’t, no one else will. Rihanna filed a suit against her manager for swindling her cash and he had this to say , “Was it really necessary to tell her that if you spend money for things you will end up with things, and not money?“ Pretty much sums up all you need to know. Things don’t make us happy , experiences do. The trick is to not get off the treadmill at once. Keep reducing the speed and some day you may not feel the need to be on it at all.

Similarly, do not fall in love with any of your investments. The environment will change. Views will change. Stocks, sectors and asset classes which gave fabulous returns in the past may not do so in the future. Confront your realities.

Do not disrespect anyone. Respect not only your parents or grandparents, but also your teachers, your extended family , maids, drivers and every person you come across. It is idealistic, but at least try. This beautiful aphorism by a Jesuit priest Baltasar Gracian–“The wise are the least tolerant, for learning has diminished their patience“–is true.At this age you are far from being wise, so learn tolerance.




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