Originally posted by smartcat Valueman, does Index funds interest you? The possibility of 'losing money' is low here, but returns might be higher.

Sure but as I said I do not want to be always tensed and excited about how the index will move and keep putting in and withdrawing my money in and out and timing the market and spending more on brokerages .

From 1990 till date i.e 2007 see for urself how the index moved and how many of us were aware of its movements .If you can predict the movement of index you can very well stay invested in index funds and I am sorry I do not have the skill of predicting the movement of index  and about not loosing money in funds ,ask the people who were invested in UTI in the 90s .


 

Dear Friends


There is no point in fighting between Value Investing / Growth Investing etc .It is like fighting between being a salaried person and being a self employed businessman . No two persons are alike and it definitely affects the way the go about investing . You can be successful as value investor / growth investor or a pure trader as long as you know what you are doing .An uncle of mine never invested in shares and always put his funds in Bank FDs but he did create wealth through real estate and they were 10 and 20 baggers . An aunt of mine does not know anything about shares or real estate etc but for the past 20 years was accumulating lot of gold whenever its prices were down and has a huge amount of Gold now that she considers as real wealth .Another relative of mine never believes in any form of investing and just trades day in and out and he too created lot of wealth .

I have chosen the path of Buffett in buying good companies at cheap price with good dividend yield and just sitting quietly allowing it to grow itself and creating wealth for me  .I am not obsessed or pertubed in seeing how the market moves day in and day out and I enjoy doing many other things apart from Investing . The reason why I am saying this I am sharing below :

1) A relative  of mine was so obessed with making money through share market feeling that he can retire with abundand wealth at his retirement and was making lot of money through share market in 1980s and 1990s and did not loose money in the Harshad Metha Scam , KP Scam , Dot Com Crash etc .He was smart enough to withdraw his money during these times and by the time he retired he had 2 posh apartments and more than Rs.50 lacs in Cash .But did he retire peacefully ? No .He committed suicide as he was so obessed in making money that he lost contact with all family members , friends etc and when he retired he felt lonely , no one to talk to etc .So he succeeded in stock market but failed in life .

2) Last year in 2006 I was on a Holiday Trip to Canada and that was the time the stock market was crashing like nine pins and I was  never perturbed and was enjoying my holidays as all my major investments were made in 2003 and they had good dividend protection .But my friends who accompanied me were in to high growth high risk stocks that they enetred in 2005 and were really frightened and has sleepless nights .They were all the time in touch with their family and brokers over their Cell Phones ( they had very high cell phone bills after that ) frustrated as to whether to exit booking looses or buying more to average the loss .They were in Catch 22 situation : If the exited now they will have to take in losses and they did not have extra  money to average the looses .They lost the entire spirit of Holiday .Their body was in Canada but mind was fully on their investments and how their other family members will react to their losses .

Conclusion : No one style is perfect to creating wealth . Be clear about what you are doing and the risks / rewards of the same .There is no point in a value investor crying during a high bull market that his investments are not growing fast like other fast growing companies and there is no point in a growth investor crying foul and blaming Government \SEBI etc  when the market crashes like nine pins .Choose your own investment style and be happy with its risks / rewards and no need to make fun of others investing style and  remember that there is more to life than just investing and the 2 examples given above are illustrations of the same .

Originally posted by valueman ..... remember that there is more to life than just investing