There isn't any risk in the market

For a few months, the title of this column has been the prevailing sentiment among investors. But that confidence shook on June 4 (the day of election results) when the market collapsed, and investors lost around Rs 31 lakh crore. However, the market and investors' confidence bounced back just 24 hours later. Such events make me wonder, "Are we becoming too conservative?" There is a psychological concept called 'loss aversion bias', which means that the pain of losing money is many times greater than the happiness of earning the same amount. However, this bias often gets forgotten in rising markets. The illusion of no risk We meet many young investors, and most of them think that we are old school. They are probably right since we have seen a couple of bull and bear cycles. We experienced pain when

This article was originally published on July 15, 2024.