scorecardresearchRakesh Jhunjhunwala: Uncovering 4 key secrets of his investing mantras

Rakesh Jhunjhunwala: Uncovering 4 key secrets of his investing mantras

Updated: 06 Aug 2022, 09:33 AM IST

Rakesh Jhunjhunwala is a name to reckon with in the investing world. Positioned among the most veteran and knowledgeable investors including Warren Buffett and Peter Lynch, this self-styled investor attributes his success to constant learning and researching of stocks and market behaviour. 

Riding the highs and lows of the stock market

Riding the highs and lows of the stock market

Ace investor Rakesh Jhunjhunwala has always been in the news for his immaculate reading of the stock market. This man who goes by the moniker “Big Bull” is counted among the leading investors in India. So much so that both industry veterans and new investors check his portfolio to find out the list of stocks recently bought and sold by him. 

Economists queue up to him to know his view while social media financial influencers quote him to explain the basics of trading and investments to their viewers and followers. This most sought-after business mogul has some simple tips to share about investing. These are actually gleaned from his experiences since he had first started investing and then turning it into a full-time profession. Some of these include:

You must feel strongly about investing

If you want to learn about investing in the stock market, you must start by first reading about it and then discussing the same with people who invest. Seeking stock market tips or suggestions will never get you anywhere. Your drive for learning about the stock market will determine how you invest in the future.

Patience is the key

When you think of investing your money, remember that you are in here for the long haul. It takes time to see the yields on your investments. That’s why you must wait for at least 10 years to see your investments earning you the desired returns. Buying stocks is not enough. You must have the conviction, grit and patience to hold on to them, irrespective of what people around you say about them. Buying stocks means that you are seeking a share of someone’s business. 

So, you must be aware of the business that you are investing in. Also, the stock market goes through its regular cycle of ups and downs, so short-term drops must not worry those with a long-term investment proposition.

Grab the opportunity as you see it

Every market cycle comes with its share of opportunities, which means that you must have an eye for them. Take for example the 2008 global financial crisis that spelt disaster in the stock markets. Those who are adept at investing used this opportunity to buy undervalued, but fundamentally strong stocks from the market. The stock rally in 2014 was the year when many investors sold off their stocks after earning huge profits. 

However, a lot depends on your risk appetite and your understanding of the stocks that you buy, hold and sell. You will never make money if you are not willing to take risks. This is because your success in the stock market depends on your character and temperament more than any other factor.

Never marry a stock

Don’t ever be tied up to any stock. Know when you must get rid of it if it is not performing well or if its price has gone up as per your expectations. Emotional investing is one of the biggest roadblocks to investing behaviour. Most investors make this mistake because they do not understand the stock or had bought it on someone’s recommendation rather than researching about it. 

You must keep your emotions at bay while dealing with any stock, which means that you must be strong enough to override the recurring economic cycles that affect stock prices. Rigidity will fetch you very low returns, which is why you must be flexible in your buying and selling decisions. Most importantly, be greedy when others are fearful and fearful when others are greedy.

Stock market strategies for beginners
First Published: 06 Aug 2022, 09:32 AM IST