Chartered accountant and finance educator Nitin Kaushik has said that real wealth is created in silence and not in chaos. Kaushik said that true wealth is built up through quiet consistency as the market rewards “endurance” and not “excitement”.
In an X post Kaushik said, “The truth about wealth creation no one wants to admit that it is painfully boring.” He explained the idea of wealth creation in a series of posts. Kaushik said that panic selling, chasing trends and adrenaline rush from a new stock pick do not result in financial gain. Wealth could only be built up through quiet consistency. According to Kaushik, “The market does not reward excitement. It rewards endurance.”
Using data to support his claims, Kaushik said Nifty has compounded at roughly 12-13 percent CAGR in the last two decades. But the average investor barely earns 6-7 percent. Kaushik said, “The gap between market returns and investor returns has only one culprit which is emotions.”
Explaining in more details Kaushik said investors sell too early out of fear and buy too late out of greed. He said that every emotional decision silently eats into compounding. “If you invested Rs 10 lakh for 20 years the difference between earning 7 pc and 13 pc is nearly Rs 80 lakh. That is the price of emotion,” he wrote.
Kaushik said that while most investors look for reasons to exit when markets fall, the wealth builders look for reasons to stick around. He claimed that markets move in cycles rather than straight lines and the “ones who survive those cycles are the ones who stop watching the screen every day.”
Kaushik claimed that controlling emotions builds more wealth than controlling finances. He wrote, “We love to discuss mutual funds, SIPs and diversification. But rarely do we talk about discipline, the one thing that actually compounds over time.”
Kaushik advised investors to first consider what money could do for them before discussing equity, debt or SIP. He said, “Once you know your destination the right vehicle becomes obvious.”
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: ZEE News
