As the discussion is happening on VP, I guess any member who has spent some time in the forum, reading, learning, will become relatively matured, so making costly mistakes don’t happen. Even, if one wants to venture into SME, I assume he would put in the necessary effort, and is well aware of the risks. My limited point is that, after a few years in the market, except for an odd instance here and there, we mature and don’t act without reason.
Again, when we gain some experience across indices, large, mid and small, and are aware of what is happening, we would know that, the alpha that is generated my active MFs is becoming hard to come by. There may be some tech advantage, some analytical perspective or futuristic vision with some managers, who go ahead and may get rewarded handsomely, but others may catch up soon. And the mediocre performance can be generated from own investments even with large caps with some mid caps, without any worry about a fund manager resigning. If time is precious, then yes, certain portion of the total capital can be allocated here. There are fund houses like Quantum or PPFAS who have investing philosophies, but there could be underperforming periods for them, and we should not feel bad at such times.
This is absolutely true. When we have a big ladder to climb in our profession, the focus should be on climbing the ladder, more so when the pay off is good, which in turn can be invested in the market. Not just Indian, but other markets too.
We can always split the capital between stocks, both for long term and short term, many indices to choose from, plain and strategical, active MFs, debt, gold/silver, and everything else that is available in the markets today. It all boils down to what we want, and what time we have.
Someone in the forum used to be active in a thread, and when someone else asked if he is still active, the answer was that, he is not active and that he moved away to index investing.
So if we have time, and are passionate, inclined towards learning, can enjoy the ups and downs, getting better which is felt internally and is visible in the numbers, and if we are confident that we can manage our money better than giving it to managers, I guess, there is a strong case to do this.
I am both a long term investor and a short term speculator, so take my views with some salt.
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