Are you Consumer Investor or Buyer Investor?

December 26, 2013

Are you Consumer Investor or Buyer Investor?

Greetings from Hitesh! Hope you must be enjoying the last week of 2013 with your family and friends. I am sure many of you must be taking a time off to look back and review the year. While you review the year…..I want to bring to your notice the confusion about the two words…..Consumer V/s. Buyer.

These two words are mostly used interchangeably and very few investors have paid their attentions to them. Let me deal with them. Clarity on the above two will help you invest in a better way.

The Difference:-

Buyer means a person who buys. Consumer means a person who consumes.

You buy Bournvita to Beer. Bournvita could be for your child and Beer for your New Year Party. For Bournvita you are just a Buyer and for Beer you are a Consumer.

Always remember, a buyer can also be a consumer but a consumer may not always be the buyer.

Your Father bought a Flat and you are staying in it right now. In fact, with the same emotions….leading Luxury Watch Company Patek Philippe has launched a campaign with a tag line…. “You Never Actually Own A Patek Phillipe. You Merely Look After It For The Next Generation”.

How does this affect your investment behavior?

Most of the investors I deal with have this confusion. When I meet them, they talk about retirement planning, long term holding, leaving a legacy etc. They talk to me as if they are BUYER. They are just investing so that the next generation can reap the benefit or they can enjoy the benefits of their investments in their old age.

Unlike their investments in Land / Flat / Watch or Antiques, the price of Equity is quoted daily. When the prices go down…..they get panicked…they forget all their wisdom, all their decisions and all their planning. They jump out of the ship. They behave as if they are the consumers!!

In fact, they are consumers posing as a buyer. There is nothing 

wrong in being consumer. The Rolex has the tag line….. “Investments You Can Wear”. The current super power USA, is the biggest consumer. USA is the perfect example of Consuming without Buying (Investing). It has lead them into DEBT Trap and Money Printing.

The Better Way:-

Just become aware about your thought process. See the Greed and Fear as your right and left hand. Two hands give perfection to the man’s structure. They give you the smooth momentum when you walk or run. When you see them as two hands….you will differentiate which one to use at the Dinner Table and which one to use it in the Morning.

My Personal Call:-

This is the dinner time in the market…..use the right hand….be greedy….write more cheques….be buyer. Invest as much as you can. You will never regret.

The Appetizer:-

As the name suggest, appetizer increases the appetite. We are offering 50% discount in our advisory fees, so that other 50% can be used for current or future consumption !! Its our New Year gift.

What are you waiting for…..Just grab it now or you will have to wait till next December. Write to us for more details.

Wish you a Prosperous 2014.

Hitesh Parikh.