R&R’s journey since inception in 2016 has been a fruitful one. During the last three years, R&R has helped over 7000 investors to realize their financial goals. And during our interactions with these investors, we gained precious insights into the minds of investors.
What we discovered is quite exciting!
We found that investors can be briefly classified into six types based on their behaviour, investing pattern and the statements, some of which we have mentioned below.
- The Logical Investor
XYZ currently. Should I buy more of this right now or wait and buy in case of further correction?”
These are the investors who try to understand the logic behind every recommendation, every report and analyze every data point in every research report. And yes these are the investors who ask us a lot of questions around it, which of course is the right thing for an investor to do.
- The Investor Who Compares
“My MF portfolio went down by 1%, but R&R stocks went down by 2% or vice versa”.
These investors like to compare the performance with their existing portfolio within a very short period of say 1 or 2 months and use these parameters to judge how their investments are working.
- The Choosy Investor
“I will invest only in 8 out of the 15 stocks recommend by R&R, and I prefer to choose my own allocations”.
These type of investors are quite selective. They pick and choose stocks selectively from R&R’s recommendations and themselves decide on the allocation.
- The Impatient Investor
“I will invest for the long term only if my portfolio appreciates by 2-3% every month.”
These investors expect their portfolio to appreciate instantly and are ready to make additional investments only for long term if they can see a 2-3% appreciation every month.
- The Passive Investor
“I was impressed by the wealth creation counsellor that’s why I purchased the subscription.”
This type of investors is passive investors who just bought the subscription because they got impressed by the wealth creation counsellor.
- The Obedient Investor
“I will do everything as recommended by R&R and follow the recommended allocation and track my dashboard regularly.”
These investors have full faith in Research & Ranking and do exactly as recommended.
So you see, there are many types of investors. After all, every individual thinks differently.
At R&R, we respect all six categories of clients, and we don’t expect them to change their perspective on day one itself. This is because it takes time to understand our methodology, why we are recommending a business, our rationale behind the buy, sell and hold, etc.
But what is more important over here is to trust the advisor or a financial mentor who is recommending you something in your best interest.
Let me give you an example of TCS and Maruti. During the last one and a half year period, TCS has performed well, delivering over 66% returns compared to negative 32% returns of Maruti. However, despite underperforming in the last one and half years, Maruti has generated approximately 178% returns in the previous 5 years, which is higher than 96% delivered by TCS during the same period.
This in no way means that TCS is not as good a company as Maruti.
What we’re trying to say here is that wealth creation is a slow process, some companies and some sectors will outperform this year, and some will grow probably next year. So instead of trying to calculate this under-performance and over-performance over a short period, let’s try to look at the bigger picture. As long as fundamentals of a business are good, let the effect of compounding do the magic for you and put your money at work even while you sleep.