In contrast to traditional notion that reading is the key to success, Ridham Desai, Managing Director and Chief Equity Strategist India at Morgan Stanley, indicated that books, by themselves, may not be the most effective.
“I used to read a lot,” Desai said, adding that while reading builds knowledge, it doesn't necessarily translate into real-world outcomes. “Reading things doesn't change your life. Experience does, So then why waste time reading? " Desai told NDTV Profit.
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Pointing to investing as an example, Desai mentioned that while there is a vast body of literature available on markets and strategies, not everyone is a good investor by just reading such books.
"I've read history, geography, science, physics, chemistry, and a few investing books. And yet, all the knowledge about investing is contained in books — and still people struggle to be good investors. If books worked perfectly, everyone would be a good investor," he said.
Desai, however mentioned that one concept that stayed from an investing book. "Though I can't recall which one — is this: the point of maximum return is the point of maximum uncertainty," he said, noting that the most uncertain time in his life was in March 2020.
I did not feel that level of uncertainty during the Global Financial Crisis, or in 2013, or even during the tech bubble. Those were plain vanilla crises — we knew we would come out of them. It was just a question of time and how much prices would fall. But in 2020, I genuinely felt I might not live to see the next three months.
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Reflecting, during this time of his life, Desai said, "So I started buying stocks. They fell another 20%, I bought more. They fell another 20%, and then eventually the market turned, I recovered everything, and we all know what happened thereafter."
Comparing the pandmeic period to present circumstances, he added, "Today also feels like a period of great uncertainty — not maximum uncertainty, but significant uncertainty. We have been through wars before, and markets usually come out well after wars end. A lot of good things happen after wars."
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