The difference between “Making a killing” and “Getting killed” …

The Economic Times carried an interesting news item today, entitled:

Retail investors raise stake in poor stocks hoping turnaround

The article is enclosed here for a quick reference. While the article is very interesting, the title says a lot about investor mindset – the reasons of buying seem to be that (1) the prices have dropped, and (2) they hope for a turnaround.

Someone has very aptly said, “Hope is a lousy strategy.” Many times, buying cheap is a good idea. Master investors make a killing by doing so, but then they are masters. Amateurs get killed while trying to copy the masters. The line between “making a killing” and “getting killed” is a very thin one.

At the same time, I would also remind all to read the following article I had written only a few days back. Click on the link below:

How ‘Loss Aversion’ Affects Your Investments