It’s the nature of the beast.
Stocks also multiply.
For stocks to multiply, one needs to do something.
What is that something?
One needs to buy stocks when they crash.
Let me give you an example.
Let’s assume markets are on a high, and there’s euphoria.
Excel Propionics is cruising at a 1000.
The prevailing euphoria seeps into your brain, and you buy Propionics at a 1000.
For Propionics to multiply 10 times in your lifetime, it will now need to reach 10,000.
Cut to now.
Stocks are crashing.
The same stock, Excel Propionics, now crawls at 450.
You have studied it.
Ratios are good.
Numbers are double-digit.
Leverage is low.
Management is shareholder-friendly.
You start buying at 450.
By the time the crash is through, you have bought many times, and your buying average is 333.
For Propionics to multiply 10 times in your lifetime, it will now need to rise to 3330.
Which event is more likely to happen?
Just answer intuitively.
Of course, the second scenario is more likely to play out than the first one. In the second scenario, Propionics will need to peak 3 times lower.
Try buying in a crash.
You are shaken up.
There’s so much pessimism going around.
Rumours, stories, whatsapps, opinions. The whole world has become an authority on where this market is going to go, and you are dying from inside.
What’s killing you?
The hiding that your existing portfolio is taking, that’s what’s killing you.
Are you liquid?
Why aren’t you liquid?
Create this circumstance for yourself.
Optimally, be liquid for life.
Then, you will look forward to a crash, because that’s when you will use your liquidity copiously, to buy quality stocks, or to improve the buying averages of the already existing quality stocks in your folio.
How do you get liquid for life?
You employ the small entry quantum strategy.
Yes, that’s about right.
We’ve been speaking about this strategy in this space for the last two years.