1 week ago

Warning Signs Short-Term Noise Is Derailing Long-Term Investing

Think you’re a long-term investor? These warning signs show when short-term market noise is taking over · livemint.com

Being a long-term investor means sticking with a plan for many years.

Some people change their investments after seeing a few months of poor returns.

Checking a portfolio constantly can make normal market movements feel frightening.

Indian stocks can fall 10–20% during many years, and larger declines can happen occasionally.

These drops do not automatically mean a long-term plan is failing.

Investors can write down their plan before markets become stressful.

They can also rebalance when their stock allocation moves about five percentage points from its target.

Keeping short-term spending money separate and following the 7-5-3-1 framework may help investors remain patient.

Key facts

Expert quoted: Rhishabh Garg, CEO of FundsIndia.com
Typical intra-year decline: Indian equities have experienced 10–20% declines in most years, according to Garg.
Larger corrections: Declines of 30% or more have occurred roughly once every seven to 10 years, according to Garg.
Rebalancing example: Consider rebalancing when equity allocation moves about five percentage points from its intended allocation.
Near-term funds: Money needed soon should be kept separate from long-term investments.
7-5-3-1 framework: Seven-year minimum horizon, five equity investment styles, three emotional phases, and at least a 10% annual SIP increase.
Emotional phases: Disappointment, irritation, and panic.

livemint.com · 1 week ago