Episode 12 - Importance of risks and how to navigate them in investments

Money Konnect

India is on the cusp of an economic tryst as it continues on its journey to becoming a USD 5 trillion economy. As India scales new heights, it is also time for Indians to accelerate their journey towards financial freedom. This can be achieved by financial literacy and by understanding the why and what of financial planning. In this Edelweiss Money Konnect podcast episode, Radhika Gupta, MD & CEO of Edelweiss AMC, with the help of historic quotes, has thrown some light on the risks involved while investing your money and how you can navigate them. Listen & learn risk navigation here.

Key takeaways:

Don’t refuse opportunities because they seem risky: In history, there have been various instances when people have refused to move forward or grab an opportunity because of the risks associated with them. However, there are others who have embraced the opportunities despite the risks and then risen to greatness. Similarly, it might be that you avoid equities because of the inherent risk in these instruments. However, instead of completely avoiding equities, you should focus on their long-term growth potential and invest in mutual funds through Systematic Investment Plans (SIPs).

Remember that bad times never last: In the market, it is easy to get disappointed by the short-term negative movements and give up halfway. However, you must understand that market downswings will always give way to market upswings. You have to adopt a long-term view and ensure that you stay focused on your long-term goals.

Don’t be afraid of volatility: When it comes to facing market volatility, most investors are unable to avoid emotional reactions. However, it is important to remember that over a period of 10 years and more, volatility generally tends to smoothen out. You never know when markets will move up or down. Thus, the best way to deal with volatility and take advantage of market movements is to invest in mutual funds through SIPs and Dynamic Asset Allocation funds that invest in a mix of equity and debt instruments and dynamically change their exposure to each depending on the market.

You can watch a video of this podcast here - https://bit.ly/3sUU6CP and learn more of these interesting investment principles on the Money Konnect Podcasts available on the Edelweiss Mutual Fund website, Spotify, Google Podcasts and Apple Podcast. We hope you enjoyed this podcast and will tune in to listen to more such podcasts on investing nuggets.