Earn Rs 1 crore the T20 way

By Sanjay Matai

It was a historic moment for us Indians after a gap of 24 years, when the team lifted the cup at the recent T20 series in Durban.

Who can forget Yuvraj Singh’s six sixes sailing over the boundary rope during Chris Broad’s over in the semi-finals? The BCCI awarded Rs 1 crore to Yuvraj, for this remarkable performance.

Did you know that you could do a similar thing with your money too?

The magic formula

Think this is not good enough to match Yuvraj’s crore? Well, that is because we are assuming a risk-free return of 6% per annum.

On the other hand, Yuvraj besides taking a big risk by throwing away his bat to score the brilliant sixes also took a risk with his career.

Can you imagine his fate if he had failed? With so many new players vying for a place on the team, his position could become uncertain. 

Now, let's assume that you also take some risk and aim for a 12% per annum return through a suitable mix of debt and equity instruments.

This, on a 20-year horizon, is a very reasonable return to expect and this will give you your Rs 1 crore.

Make the right selection

A good shot selection is important else you might end up getting a single or two or worse, you might simply get out. Similarly, good investment selection is important.

Else you might make very low returns (as can happen in insurance policies) or lose money (as can happen with penny stocks).

Invest in time

Another issue that could be bothering you is the 20-year period. Too long a wait to become a crorepati?

Unfortunately, instant money is possible only if you win a lottery ticket or if you inherit a large sum. In either case, you would need to be extremely lucky. For a vast majority of us, there is no short cut.

If you think Yuvraj was lucky and made his one crore in just one over, you couldn’t have been more wrong. We need to account for his hard work and discipline for over 15-20 years. Yes, it took him these 15-20 years to prove his mettle. 

Sweat it out like the men in blue

You need to show the same discipline, hard work and of course have patience, like Yuvraj. Unfortunately for you, there are no short-cuts.

The Shahrukhs, Sachins, Ambanis, Tatas and the Narayana Murthys of this world have earned their money after showing a lot of persistence and discipline.

But remember: the world is full of opportunities. There are a million gold mines out there.

You will have to keep going till you find your pot of gold.

The author, Sanjay Matai, is an investment advisor.He can be reached at sanjay.matai@moneycontrol.com