Momentum investing Vs. Long term investment... my point of view...

All of us has attended mutual fund seminars or Investment seminars at least once in our life. They encourage the attendees to focus on long term investment by giving us examples of #wipro #Asianpaint #Eicher

this lure the investors and new players to focus on long term investment. But just think for a while, do long term investment really creates wealth? the answer is probably No. Shocked? just scroll the thread before jumping to the conclusion. Just note down names of 25 companies

which gave multi folded returns to the investors over longer period of time. It would be hard to name more than 25 companies. Now think on the other hand, there are roughly 1400+ companies listed on NSE out of which only 2% companies might be known to us which came out as hero.

you would argue that only choose blue chip companies. But dont forget that #Suzlon #DHFL #YesBank #Bhushan all were blue chips once upon a time.

Now, lets assume, we have chosen the right one, e.g. we chose the Wipro - the best example of the seminars. Now think on yourself,

could you hold the stock till it gives you some thousand percent returns? The answer is simple No...

you probably would have held it max up to when it gives you 10x returns. plus there is one more drawback is that whether your choice of stock is proper or not that comes to your

knowledge only after 3 or 5 years which is probably 20% time of your trading career assuming you have 25 years of trading career.

Now think of momentum investment which only focus on taking a slice of the move. It is far better because it give you win or loose within very

small span of time. You also dont need to think of the company, fundamentals, overall industry, etc. You might wonder it just gives you 5% or 7%. In this return, I can not be crorepati!!!

You are again wrong. Why? Because if you can generate only 2% per month, then

1 Lac invested initially, becomes Rs. 3.80 crore roughly after 25 Years. Yessss you read it right. And now think if you would have invested in a company which is proved not performing, after 3 or 4 years, then what can be done?

To conclude this thread,

I am not saying that long term investment is bad, it is absolutely good but not just dream of wipro after attending such seminars. Rather I would prefer everyone to focus on momentum investment in the beginning which helps you to understand the reality of market.

Giving here few names, which can really help you to get some nice momentum trading ideas.

@RajarshitaS @TraderMindset @TraderHarneet @BissaGauravB @CAPratik_INDIAN

Thanks for giving time to read the thread. Happy Trading!

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