Market discipline, the certainty of boom-and-bust cycles and avoiding allure of quick gains are among the key lessons that investors can draw from the Ramayan, according to stock market veterans Nilesh Shah and Vijay Kedia.
"Ram had ups and downs, from being prince in Ayodhya to being exiled in a forest," Shah, group president and managing director at Kotak Asset Management Co., told NDTV Profit in a special show the day of Ayodhya Ram Mandir consecration. "Likewise, markets also have ups and downs."
"We get lured by greed and fear, like Sita was for a golden dear. We have to also honour the Lakshman Rekha, beyond that there will be losses. Operate within the discipline of the rekha — stop loss for traders and long term (allocation) for investors," he said
Before drawing the Lakshman Rekha, the investor should understand the market, said Vijay Kedia, managing director at Kedia securities Pvt. "Knowledge and experience in important."
He said the markets tend to get into a euphoric mode during bull runs and finding multibagger stocks become as much a rush, as all participants seek the 'sanjivani'. "It is important to be patient."
"Best exit strategy can be learnt from Vibhishan. He was associated with a AAA company (kingdom of Lanka). When he realised the management of the company is defocused, he exited and went with another AAA company (Ram's army) that was at rock bottom," he said. "This is what you learn."
Greed comes with investing, they said, but it is important to always stay within the limits of the Lakshman Rekha.
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