The Market Podcast | Prasun Gajri says spectacular gains for first-time investors just beginner's luck, could run out

A lot of first-time investors joined the party on D-Street in 2020 and have made spectacular gains post March, but the beginners' luck could run-out sooner than one could foresee, Prasun Gajri, Chief Investment Officer, HDFC Life, said in ‘The Market Podcast’ with Moneycontrol.

It is encouraging to see that a lot of people are getting involved with equity markets. “But, at the same time, I think a lot of these investors could be first-time investors,” says Gajri.

He further added that very young people are trying to dabble in the market for the first time and enjoying the highs or the ‘beginners luck’ in a way to see the market rise from the lows of March 2020.

We have seen a spectacular rise pretty much across the board be it largecaps, midcaps or smallcaps. Everyone has made money but having said that, people need to realize that equity markets are not a ‘gambling den’ and true benefits of investing are seen over the long-term.

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Prasun Gajri

Chief Investment Officer|HDFC Life

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The equity market is a two-way street. So you will see very sharp moves on either side.

“My whole belief is that everyone who invests in equity markets needs to be fully aware of these risks, and then invest. With that said, there is nothing wrong with trading for short term gains,” explains Gajri.

“Clear understanding of both aspects of investing is extremely important. And at the same time, people need to realize that spectacular gains are just a question of luck,” he said.

Gajri emphasized on the fact that equity markets cannot deliver 40-50 percent gains every time you invest in them. “The longer-term gains are far more mundane, maybe if you look at the last 25-30 years history, we’re talking about maybe low to mid-teen kind of an annual return which could come from equity markets,” he concludes.

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