Every batsman is different and so is every investor
In our previous article, we discussed how diversifying across different types of investments helps investors to achieve a good balance of growth and safety and how it is similar to a cricket batsman balancing his innings using a combination of 4/6s, 1s/2s and dot balls.
But does every batsman follow the same style of batting or strive to achieve a similar combination of 4s/6s and 1s/2s? Obviously not.
For example, here are the ODI batting statistics of 4 very successful Indian batsmen.
💡Super Investor Idea💡
Just like every batsman scores runs with a different combination of 4s/6s and 1s/2s that most suits their game, every investor needs to understand their own mindset and choose a combination of equity, debt, and gold that suits their investment style and risk comfort.
In cricket, the proportion of runs scored in 4s/6s for any player depends on multiple factors which include the batsman’s natural ability, batting style, willingness to take risks, batting position, the context of the game, role in the team and more.
Similarly, a Super Investor should invest considering multiple factors as well.
Settle down and build a strong foundational portfolio: A batsman takes his time to settle down, assess a match’s situation, analyse the condition of a pitch, & measure the strength and weaknesses of a bowler.
Just like that, at the time of getting into the Investing game, focus first on setting a strong foundation based on what suits you the most.
💡Super Investor Idea💡
This is the cricketing equivalent of building a balanced portfolio that keeps the 1’s and 2’s ticking & keeps targeting a good proportion of 4’s and 6’s in a careful manner.
Hit the right shot at the right time: When you have a strong foundation, the market will periodically allow you to take advantage and hit the proverbial sixer. This is the cricketing equivalent of a juicy full toss which a batsman can take advantage of to hit a 4 or a 6 with very little risk.
If you periodically adjust your equity allocation based on market conditions, just like how a batsman adapts their game based on strength of the opposition, playing conditions &scoreboard pressure, you will play long innings as a successful long term investor.
To explore more about investment solutions that could help you strike a balance between growth and safety to suit your investing style, click here.
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