At the recently concluded Round Table event at The Quorum, Mumbai, senior leaders from Financial Services shared their thoughts on how to stay invested when markets are volatile.

Moderated byLWL Titan, Shiniji Kumar, Co-founder, SALT – mysaltapp,Shinjini has 3 decades of experience in building businesses, strategies, teams and trust.

Joining the conversation and contributing valuable insights, our esteemed panellists included:

• Amisha Vora – Joint Managing Director, PrabhudasLilladher
• Meghana Malkan – Trading and Performance Coach
• Sumita Pillai – Chief Executive Officer, Torus Private Wealth
• Deena Mehta – Managing Director – Asit C. Mehta Investment Interrmediates Ltd.

The discussion included critical aspects of money management in the current global scenario, foundational principles of investing and personal finance as well as the expanded role that women can play in managing money for themselves and their families.

So if you’re looking over your shoulder wondering if your portfolio will “survive” or if this is indeed the right time to buy or sell, here are a few key takeaways that these experts believe you should be thinking about.

The 5 biggest takeaways from the talk: 

1. Old is Gold:

Sumita Pillai talked about the role of Mutual Funds and fund managers in the investing journey of people who do not want to or have no inclination to enter the market and directly trade or buy stocks and bonds. Amisha Vora went into details of compounding to make the point that starting early, simply getting slow and safe return over time will keep you in great financial health in the future. So, even if you are in day trading and are making profits, it is a good idea to take part of your profits and invest them for long term compounding benefit. In fact, a major problem is that people sometimes trade like investors and invest like traders. Consciously making decisions on what part of your portfolio is to be held for long term compounding vs where you need to have stop loss limits and exit are important for people that do both, trading and investing. In addition, the panel talked about investing in gold bonds or digital gold as a measure of diversification.

2. Know Your Portfolio:

First and foremost, it is imperative to know and review your portfolio. Make time for your money was unanimous advice from the panel. Deena Mehta cited research that suggests up to 50 percent growth in wealth can happen merely from regular portfolio reviews. She made an interesting contrast between how much effort people take to keep physical assets safely; often paying for bank lockers to keep their gold or other physical assets. But when it comes to financial assets, there are many examples of people not being careful about assigning nominees or even just keeping the papers in good order.

The other key aspect to bear in mind is asset allocation. While sectoral deployment of your portfolio may not be so important when your portfolio is small, as it grows, pay attention to concentration in certain types of assets or currencies. Did you know that global research indicates that more than 90% of wealth is created by asset allocation alone and just 4% by stock selection? Ironically, we spend 90% of our time in stock selection and very little on asset allocation.

3. You haven’t missed the bus:

The highlight of the discussion was the advice from Deena Mehta that ‘This is a market. You are here to buy!” Markets will go through volatility and there will always be something good that will be a good bet for future. The panel talked about the need for spending time to learn about companies you are investing in. Like Amisha said, “You are not buying the share, you are buying the company”. And if that effort is too much, maybe just go for that index fund because few people beat the return on the indexes anyway. Also, volatility in the market means that sometimes, like when the market went for a rally post the Covid dip, people felt like they had missed the bus for buying cheap. With the current volatility in the market, it’s a great time to dip your toes again… carefully. “The bus is right back at your doorstep!” in Sumita’s perspective.Capitalize on the scenario, plug your money in, and wait for the markets to climb up –slowly but surely.

4. Safety First:

The house was unanimous in their opinion that it was the best time for people to learn and earn in markets. Deena and Meghana talked about the old days of trading. Shinjini talked about the fact that over time transparency in the world of investing had improved to a remarkable degree, aided by availability of good quality information and learning material. However, not many investors actually take the opportunity to learn and this has a bearing on the decisions they take and the money they make. Meghana made the point that because the market does not require qualifications to enter it, there is a tendency to jump in and sometimes not make that effort required to learn. However, the positive side of it is that women specially can use the opportunity to access resources and take advantage of the flexibility that the profession of investing or even trading offers. Deena gave the powerful example of Lakshmi and Saraswati, both being women and exhorted women to take charge of not only their own finances, but that of their families. 

5. Up For Rent!

Deena Mehta stressed on how the new age should be looking at rentals as opposed to ownership. The idea being to invest more of your money in the markets and enable growth. We must look at rental of homes, jewellery, transport (Uber/Ola) etc and thereby cut cost on fixed assets, which will allow us to multiply money through intelligent financial planning.

Powered by insights born of years of experience of navigating the markets, the discussion threw up loads of timeless wisdom from key financial leaders. To get a first-hand experience of more such discussions in the future, become a LWL member today, by signing up now