In the current market scenario i would like to re-emphasize on some practical insights for your reference to be a better and successful investor.

Follow Asset Allocation religiously. Invest based on your goals and requirements. In a rising market people tempted to change the allocation towards risky assets based on positive sentiment and past returns. Keep a check on your emotions to avoid taking wrong decisions.

Over short time increment, one observes the variability of the portfolio, not the returns.”- Nassim Taleb.

Do not chase stocks or investments at any price. There will be always a next bus available to board. Patience and discipline are the two important traits of a successful investor.

Do not commit large sums of money into equity at one go currently, particularly through PMS and other AIF category. Moreover it is a sin and bad idea to move your safe money in debt funds and FD which are meant for cash flow management and short term needs to equity, based on wrong promises by the people who lure to invest by showcasing past performance. Keep in mind that there is no product which offers guaranteed returns.

At the current valuations one should trim down the expectations of making high returns from equity in next 1 to 2 years as in the past, as markets already factored majority of the earnings growth.

Note that investing in equity is for future returns. In the long run returns from a stock will come due to its underlying growth in earnings. However in the short term prices move based on liquidity, sentiment etc. In the long run stock prices are slaves to earnings. The returns in the long run are more or equal to nominal growth of the economy.

Money is coming into equity as people are getting affected by TINA and FOMO. (THERE IS NO OTHER ALTERNATIVE AND FEAR OF MISSING OUT)

Even the eminent banker and member of SEBI committee, Mr. Uday Kotak sounded caution on tsunami of flows into equity market.

Lastly i request to stay rational and make prudent decisions with your hard earned money.

The less prudence with which others conduct their affairs, the greater the prudence with which we should conduct our own affairs.-Buffet