Your Investment Performance depends on the difference between – NOT BEING IGNORANT and BEING KNOWLEDGEABLE?

30^th September 2019

Your Investment Performance depends on the difference between – NOT BEING IGNORANT and BEING KNOWLEDGEABLE?

Dear Fellow Travellers,

Greetings from Hitesh! In continuation with our educational initiative – we are dealing with another issue which most commonly misunderstood by investors. Most would love to believe that not being ignorant and being knowledgeable is the same thing. But there is a great difference and thanks to that difference there is a difference in the success ratio of normal investors and smart investors.

What is Not Being Ignorant?

When you listen to somebody/read/discuss on some issues and after that listening/discussion/reading when you deep down feel that what other guy or author is saying is RIGHT – your ignorance related to that issue is gone. Now you are not ignorant about that issue.

For example – your religious guru says that ATMA is AMAR and you get that feeling after listing that what this guy says is right. So, you are not ignorant now about ATMA.

Your neighbor or friend or your success coach shares his success story in the field of investments or any other field – you feel convinced that you should also take those kinds of steps to make tons of money. So, you are not ignorant about ways of making money or getting successful in that field.

What is being KNOWLEDGEABLE?

When you combine your information got in the above steps with your experience and what you get in the end is the KNOWLEDGE. Knowledge is not information alone. It must be backed up by your experience with respect to that information.

What happens when your information does not become KNOWLEDGE?

In the above example – you have heard that ATMA is AMAR – SOUL NEVER DIES – but when the time of death comes – most guys are in PANIC. Most guys when they have to go for the major operation of HEART – they get panicked the most. This happens because their information – Soul Never Dies have not become their knowledge. It is BORROWED from the GURU or SCRIPTURE.

How does this affect investment performance?

When a normal investor listens to the success story of BUFFETT or RAKESH – they get motivated to become a long-term investor in the stock market. This is a stage of not being ignorant of them.

Now, once they invest and prices go down – they get panicked and run away from the market. Their BLOOD PRESSURE shoots up and they start blaming their luck / the guy who recommended them the investment idea / their broker/government/market/operators and things like that. The height comes when they decide that nobody makes money in the market based on their experiences in the first month / first transaction or first year.

What they are not ready to understand that Rakesh could get just 4 ideas in his life so far to make him worth Rs.15000 Crs. This is a PART OF KNOWLEDGE and that comes when you explore the ways with open mind, patience, and guts.

Why this behavior full of lack of common sense?

Most guys don’t know themselves. They have some images about themselves that they are smart / they are successful/ they are well educated and things like that. But when they invest – they come to know that they are not what they believed themselves to be. So, rather than breaking their FALSE image – they prefer to get out of the market blaming others.

In my 28 years of experience with the individual investors – I have seen that they love to talk about the long term but they are not programmed to stay on the pitch for the long term.

What Next?

We are in the period of NAVRATRI. They call it the most auspicious period for various SADHNA. I would recommend using this time to KNOW yourself in as many details as you can. The best way to KNOW yourself is to take EXPERIENCE of as many ideas as you can. Don’t go by borrowed ideas. They will take you for a ride in the end.

Always REMEMBER the death of KARNA in MAHABHARAT. He was killed at the most important juncture in war as he forgot the knowledge, he took it from his GURU PARSHURAM with cheating. His death was the biggest reason for Duryodhana's defeat. Had KARNA killed ARJUN, DURYODHAN would have not lost.

So, you decide, you want to become KARNA or ARJUN?

I wish you all the best.

Follow me on Twitter @hiteshmparikh Or on Whatsapp - +91-9869425399.

Live With Passion…Invest With Passion.

Hitesh Parikh