At the outset I wish you and your family members a very Happy, Healthy, Peaceful and Fulfilling 2019!

Thought of the Year: In today’s world where every one of us connected to various social media apps. And we are very much aware, the way they are influencing our decision making process, diverting our attention from professional and personal lives.

In order to make ourselves resilient from such distractions is to restrict the usage by observing the usage pattern and avoiding the noise by following rules bound approach in our usage.

Three different books- Deep Work by Cal Newport, Focus By Daniel Goleman, peak by Anders Ericsson &Robert Pool points in the same direction that, quitting social media is the first step towards developing greater clarity of thought. (source: Signing Out article by S. Mukherjea)

Quote from Carl Newport in his book Deep Work:

“These services (social Media) are engineered to be addictive- robbing time and attention from activities that more directly support your professional and personal goals…Eventually if you use these tools enough, you’ll arrive at the state of burned out, hyper-distracted connectivity..The use of network tools can be harmful.”

In my last two write-ups, the reiterated the importance of asset allocation, updated the regulatory changes, and how market corrections are need to be welcomed by long term investors like all of us.

Volatility is good:

Going forward many market participants feel general elections is a big event and it will have a meaningful impact on markets.

However if one goes backs to past history it is evident that such swift movements are temporary and short lived; in the long term markets always adjust to fundamentals, which is earnings growth.

Ups and downs in the market due to elections and other local and global factors need to be welcomed and to be utilized. Stagger investments into equity through SIP’s and STP’s are best tools to take care of it.

Respect Asset Allocation:

Every investor wants to see his investment should grow in linear manner. However in reality it is not. I always points out that, fall in the market is the nature of equity markets.

One should be mentally prepared for it and should not bother with the notional losses in the portfolio. Treat it as a price paid for long term growth.

To withstand such notional losses one need to invest based on his needs to fulfill long term goals which gives a way to proper asset allocation and can withstand different phases of market and able to create wealth from equities.

Simple mantra of investing should be “Protecting the downside is more important than chasing upside”.

All I want to know is where I’m going to die so I’ll never go there. -Munger

We have done better last year by not following the herd and stayed away from market euphoria at exorbitant valuations, particularly in mid and small cap funds and stocks. Allocated money into asset allocation funds, debt and following SIP, STP’s strategy and cushioned the portfolio’s to a great extent.

The task of man is not to see what lies dimly in the distance, but to do what lies clearly at hand! – Sir William Osler

We are fortunate enough as interest on bank and corporate FD’s and yields from debt instruments are back to rates which we have seen last 4-5 years back.

People in higher tax slabs are able to generate better returns by investing in debt funds. people with no tax liability can look for corporate FD’s etc. Only few countries have such high rates globally.
Wishing all the best in the year ahead!