What I am taking about is average market returns which has been in in this range historically. If you pick a random set of stocks they should provide you with above stated returns. What I am not factoring in is the individual’s skill to find undervalued stocks that will give a return in multiple of this average market return. So, there will always be a Warren Buffet, a Rakesh Jhunjhunwala, but these people are exceptionally gifted or lucky, probably both.
If you can control your emotions and are gifted in picking up the right shares small cap is the segment for you. eg. That share was Titan for Rakesh Jhunjhunwala. The reason is that a discerning investor will have a greater number of stocks to scan through and pick the right one. But due to higher volatility in these stocks you need to be emotionally stable to make the right choice regarding buying and selling while not getting swayed by emotions.
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