If you have a lot of money and can afford many things, life is great – Economics.
If you have a lot of choice, it adds stress – Psychology.
Walk into a typical wedding I attend, the range of food that is available normally numbs me. One of the weddings had a FULL range of south Indian food – dosa, wada, ..etc., then chaat varieties, Chinese, Hyderabadi biryani (the cooks were ACTUALLY flown in from Hyd to Mumbai), a range (I think 12) of sweets, and of course contiental.
Now I was enjoying ‘seeing’ all this. However imagine the stress of an individual who has a plate in his/her hand and having to choose one of the 12 sugary poisons?
Now open your wardrobe…if you have 70 shirts and 40 pants, you go through the same stress every day!!
Now let us come to mutual funds / ulip / ….generally the financial services. At the last count Amfi said we have almost 5000 schemes. Wow! Imagine having to choose from this financial jungle.
- past performance (the only thing you think you understand) is not an indicator of the future
- only over 20 years will you know whether it was a good decision or bad.
- it could have been a FANTASTIC decision over 22 years, but it was the years 21 and 22 which gave 93% and 55% returns.
-over 20 years you had got 14% return, but however if you had stayed for 2 more years, this would have beena much better figure.
What does the poor adviser do? Create more confusion by using his data crunching abilities…
God, save the investor (if he/she is not extinct)….
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