CII IWN Aurangabad Chapter organised a knowledge gaining and highly interactive session on “Grow Your Money Wisely” for their members.
The session mainly focused on the four kind of wealth i.e Social wealth, Family wealth, mental wealth and career wealth .To build and enjoy these wealth the centre point is money.
Goal-based financial planning gives investing a perspective and helps you stay on track. Investors who invest randomly and don’t have goal-tagged-investments find it difficult to handle volatility in the markets. And volatility is a normal feature of the market. It’s not a bug as many would believe.
There are different asset class some for wealth creation, some for wealth preservation, some for long term and some for short term. Also different asset class behave different in different scenarios. So proper mix of all the asset class as per your need assures all-weather portfolio which reduces the volatility of your portfolio and helps you achieve your goals. Complete focus on the portfolio asset allocation at the start of your investment journey will surely ensure a smooth ride towards long term wealth. Diversification is not a technique to be used to enhance return but a technique to earn optimum return at lower risk. It is known that 90% of long term wealth creation happens through correct asset allocation decisions. The session also touched upon Compound interest which is the eighth wonder of the world. He who understands it, earns it, he who doesn't, pays it. The most intelligent man on earth, Albert Einstein’s quote speaks volumes about the power of compound interest as it can truly do ‘wonders’ in your financial life. The longer duration of time you stay invested for, the more benefit you will receive from compounding. For the investors, the entire decision making process is a war between their Brain and Emotions. There is a huge percentage of biasness involved in a decision made by most of the investors.
The session also briefed about how to step out from the world of illusion. To be a better investor, you need to learn these two facts. No one knows everything and nobody has control over everything. If you choose to remain under the illusion of knowing everything, you will never be able to explore more and more about investing. The fear of losing their money is a lot bigger than the excitement to gain something. Moreover, it is hard for them to accept that they have made a bad investing decision. They cling to their decision and hope to get their money at the end of the day. In such cases, the investors usually end up losing everything for once and for all.
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TBNG Capital Advisors Pvt. Ltd