Is Rakesh Jhunjhunwala Too Big To Be A Role Model?

Is Rakesh Jhunjhunwala Too Big To Be A Role Model?

Rakesh Jhunjhunwala

You must have noticed that Warren Buffett quotes and Rakesh Jhunjhunwala's tips as well as quotes are blatantly cited in the context of investment. Some quotes are composed with such authority that they instantly lure you into believing anything that follows. But sometimes these quotes and anecdotes can be quite misleading. Naturally, the question you will ask is isn't Jhunjhunwala's philosophy worth following? On the broader level, one can even ask, is Rakesh Jhunjhunwala an ideal role model for the retail investors? Yes, he is! But what works for him may not necessarily work for you.

It's high time to put in perspective this entire concept of blindly following one's role model.

Celebrity Investors' Quotes Are Not Ready-made Investment Plans

The quotes of famous people are used to give credibility to the point one is trying to make. In no circumstances could it be absolute. Likewise, looking at Rakesh Jhunjhunwala's tips and quotes in isolation can oversimplify the complex matter like investment. Investment plans have to be tailor-made to suit the requirements of an individual. Furthermore, if stock market happens to be your medium of investment you have to be all the more careful and diligent in your planning.

Brush Away The Halo Effect

In order to achieve your financial goals, it's important to first define your financial goals in terms of priorities. It's true that going long in stock investment is a good idea for the retail investors, but to meet your financial goals you can bend this golden rule a little. One can mend one's way to suit one's needs. For example, you have bought 250 shares in Tata Motors when it was trading at 450. When it reaches 500, you are in Rs. 12,500 profit. Now you can either book the profit or stay invested and go long with this stock. This is the point where your judgement comes into play.

Don't Follow Rules Blindly, Personalise Them

Famous quotes, maxims, sayings sound good but they are just thoughts, they can't be a sustainable investment plan. There are many famous quotes attributed to Rakesh Jhunjhunwala and Warren Buffett and they do talk about the wisdom of investment in an evolved manner. However, retail investors should learn to give the famous investment rules a spin of personalisation. There is no doubt that these investment rules are the outcome of years of experience and practice of these investors but everyone has to have his own investment strategy which works best for him. Hence it always pays to follow these rules but don't let them become shackles on your rational thinking.

Be Smart And Selective

There are many ways one can misinterpret investment rules. It would be fair to say that many times these quotes are used out of context. For example, both Rakesh Jhunjhunwala and Warren Buffett profess the advantages of long-term investment, indeed, it's a good policy, but if you apply it on stocks which have short-term potential you are bound to face heavy losses. Yes, every stock has to be assessed to determine whether it has short-term or long-term growth potential. Thus it's important to be selective in your approach. To make smart investment choices you can either do an in-depth research or subscribe to a good stock advisory firm which follows Warren Buffet and Rakesh Jhunjhunwala's tips and identifies good stocks to help you stay ahead in your investment.

 

ABOUT AUTHOR

Niveza Editorial Desk : We are a team of stock market nerds trying to stay ahead of the herd. We spend our grey cells everyday to a pave a smooth road for our clients in the shaky world of stock market. While tracking the mood swings of the market we bring our clients the most rewarding deals.

LEAVE A COMMENT

RECOMMENDED READING

Portfolio Management Service: Outsource Your Investment Worries

The stock advisory service is the best option for you if you want to invest in stock market but don't have adequate knowledge of it. An advisory firm gives you the much-needed hand holding to take the right decisions. Their research reports an
Read More>>

Stock Advisor: For High Growth & Better Risk Management

Stock investment is messy. Yes, there is a big growth potential but if you are doing it on your own and you don't have the experience of fundamental analysis, it can be an uphill task. That is one of the reasons why most of the investors who u
Read More>>

Rupee Tumbles To A New Low; Market Expected To Consolidate

Our Analysis This week, the market consolidated between 11,300 to 11,500 due to lack of positive triggers & consolidation in heavyweights like HDFC, HDFC Bank, Reliance. Indian Rupee de
Read More>>

Free Share Market Tips Today: Stop & Read Before You Invest In Stocks

Various popular stock market news portals and TV channels discuss trending stocks and provide free share market tips based on technical charts and often without in-depth research. Our research desk analyses these trending stock market tips and pro
Read More>>

Value Investing: The Road To Value Picks & Undervalued Stocks

You must have heard many times that Warren Buffett is a value investor. In the Indian context, even Rakesh Jhunjhunwala is referred to as a value investor. It does tell us that these are smart investors but what exactly does value investing me
Read More>>