My take on Investing
11 June, 2020
Let me begin by stating a fact.
Richness is a relative term. Just because you have a lot of money, doesnt make you rich. Having more money than others does. Its all relative. Now, let me try to explain this with an anology between a real running race and the race to make more money.
In a running race, acceleration is when you run faster than your current speed. If there are 10 people running and if all of them accelerate at the same rate, in an ideal world, nobody is going to win the race (of course in reality someone is going to win, but only by a very narrow margin). Extending this logic to money, you accelerate when you are worth more than the previous day. But nobody is richer when everybody accelerate the same.
Now lets look at Banks (Fixed deposits/Stock markets/Gold schemes/Mutual funds). They are just brokers. They take the money from people without ideas, and give it to the people who have ideas who accelerate its growth. Again, nobody is richer when everybody invest in the same things.
Do you see where I am getting at? The only person who actually gets rich is the person with the ideas, the one different from others.
The point is, there is no value in following the crowd. Stocks, Gold, FDs and MFs - everybody do it these days. Sure they help your money grow. But these wont make you richer than others, because everybody do it. These are usual stuff usual people do. Nothing out of the ordinary. But people who take risks, they reap the rewards, they go ahead.
So what can you do that makes you make more money than the others? According to me, the investment that has the most returns is doing what others don’t do and with consistency. And thats investing in yourself with an appetite to take risks and learning from its failures.
Reading regularly, being healthy, exercising, having a great personality, getting another degree, thinking for yourself, making long lasting relationships, simply smiling more and having a positive outlook towards life are some things you can do to invest in yourself which will push you ahead than most people. Start a business, travel the world, discuss and debate, learn from others, etc are somethings you can use your money to invest in your knowledge. Do things that others dont. There is value in that. And knowing this is the secret of successful people. Putting everything in usual investments and thinking you are safe for life will only make you as rich as your neighbour. You will still be unhappy in the long run.