VR Logo

Lessons to be learnt from KBC

Individuals should base their investment decisions on their personal goals rather than market movements

A couple of weeks ago, a KBC contestant named Prashant Batar attained his 15 minutes of fame by winning Rs 1 crore and then losing it because he wanted to win Rs 5 crore.

At Rs 1 crore, he took a risk on an answer that he wasn't sure of and in the way losing all money except Rs 3.2 lakh. I don't how Mr Batar is feeling now, but in the heat of the moment he seemed very certain that it was worthwhile risking the Rs 1 crore he had already won in order to try and get Rs 4 crore more. He could have walked away but chose not to.

A couple of weeks later, there was another contestant who also came to a point where she could have risked all, but took a different decision. Jyoti Chauhan, a police constable from Rajasthan had won Rs 12.5 lakh when she was faced with a question the answer of which she was almost but not perfectly certain. However, she chose not to answer it because she really needed the money she had made till that point and didn't want to take any risk at all.

As it turned out, the answer she would have given was correct but she didn't seem to regret the opportunity loss of another Rs 12.5 lakh. From whatever she told the audience about her circumstances in response to Mr Bacchhan's prodding, it seemed clear that the money she won would transform her life. And so she took the right decision and chose to walk away.

I think these two little incidents could teach many investors a great deal about how to look at investment goals and how to take the decision to walk away. Often, investors think that their investment strategy and goals should be determined by what's happening in the stock markets or in the economy. That may be true of institutions but not of individuals. Individuals need to be more focused on their own lives. The answer to where you should invest and how far should you go before walking away lies more in what your personal goals are, rather than in the questions that you are asked.