Rules to be Treasure Life Long While Investing and Trading in Indian Stock Market


Someone has sent me this message which talks about the golden rules of investing and trading in Indian Stock Market. I guess If I had known this earlier I would have definitely saved few lakhs of rupees.

These could be read again and again. Every time you read you would get something new to learn.

:eight_spoked_asterisk: 80% of gains come in 20% of the time. So an investor needs enormous patience and conviction to hold stocks or Mutual funds for 10 or 20 years.

:eight_spoked_asterisk: Why not all investors get rich? They like to get rich without going through many years of discipline & patience. The process leads to an outcome.

:eight_spoked_asterisk: An inferior strategy you can stick with is likely to produce better results than a superior strategy you cannot stick with.

:eight_spoked_asterisk: Prices change frequently. Value change over a period of time. There lies the opportunity.

:eight_spoked_asterisk: Compounding is backloaded. It works well only over a longer period of time. There is no substitute for time in compounding.

:eight_spoked_asterisk: 99% of the time, doing nothing is the best thing to do in the market. It is good to be a Rip Van Winkle investor. Activity hurts. Sit still.

:eight_spoked_asterisk: You cannot predict or control markets. What you can control is how much you save, investment process and behavior. Focus only on that.

:eight_spoked_asterisk: The random outcome doesn’t invalidate the need for a process. Sound process and consistently sticking to the same increases the chance of luck.

:eight_spoked_asterisk: Investors are human. That’s why markets would never be fully efficient.

:eight_spoked_asterisk: Markets usually run ahead or fall behind. Rarely in equilibrium. Over or undervaluation can last for a long time. Don’t time the market.

:eight_spoked_asterisk: Buying and selling is easy. It is holding on through ups and downs is difficult but ultimately most rewarding.

:eight_spoked_asterisk: Tiny drops of water make the mighty ocean. Invest regularly. Invest for a long term. You can create huge wealth.

:eight_spoked_asterisk: Not investing in equity is riskier than investing in it. Remember, you need to beat the inflation and retain your purchasing power.

:eight_spoked_asterisk: We see past bear markets as missed opportunities. However, thinking of future bear markets is gut-wrenching. Strange investor psyche.

:eight_spoked_asterisk: If someone keeps reviewing the value of his house every day, we may suspect his mental health. But that’s what we keep doing with our equities.

:eight_spoked_asterisk: Equity investments are subject to behavior risks. Always keep a check on your emotions while investing.


Below is how the Market Crash Acts and Reacts. Most of the time the bottom fishing leaves many left out. Keep some spare crash and stay invested all the time.

-1% Mock the permabears
-2% Meh
-3% Yawn
-4% Off the highs
-5% Pullback
-6% Healthy correction
-7% Buying opportunity
-8% Stay the course
-9% This too shall pass
-10% Correction territory
-11% I’m a long-term investor
-12% Stocks always come back
-13% Don’t panic
-14% Draw lines on a chart
-15% Look for attractive valuations
-16% I knew this was coming
-17% Blame Cramer
-18% This sucks
-19% I should buy some downside protection
-20% Bear market
-21% I should have listened to my gut
-22% Buy when there’s blood in the streets
-23% I was early
-24% Is this the bottom?
-25% This sucks
-26% Uggggh
-27% I can’t take this much longer
-28% I sold my stocks
-29% I’m never buying stocks again
-30% Good thing I sold
-31% I should buy gold
-32% And silver
-33% I don’t even care anymore
-34% Glad I stopped looking
-35% Bottom