In today’s world, everyone wants quick results, be it fame, success, or money. In terms of money, post covid share market was been considered a place to earn quick bucks to satisfy short-term wishes or aspirations and as well to satisfy an ego that I can double my money in a short period of time. Millennials are the ones who were and are very active in share market investments post covid corrections and the followed bull run. Many are those who just have started earning or who just get to know about share market investing.
When such investors think of share market investing as earning easy and quick money, they are the ones who actually do not understand the basic functioning of the share market. When you invest in an equity asset class through a stock purchase or equity mutual funds you are buying part of the business. To provide you with sustainable wealth, companies need time to grow. Short-term speculative market movements tempt such investors to see only short-term gain and deprive them of the opportunity to create long-term wealth.
FOMO feeling comes because of such a mentality. To book a short-term profit entry-level matters a lot. So when the market crashed 2 years back and within some months it again bounced back. At that time many Millennials thought that they had missed the chance to earn short-term money. But no none can predict market level. When a bull run will start, and when the market is going to turn into a bear run is very hard to predict.
TIMING the market is next to impossible for common investors and even so-called experts. When we give more importance to short-term gain we end up feeling FOMO with each correction, But historically it is proven that in long run it really does not matter at what market level you have invested your money. The TIME in the market matter lot more than TIMING the market.
So better avoid this feeling and focus on investing according to your financial goals and required asset allocation. Invest cautiously and in a staggered way in this current situation, when the market is very volatile. This time the recovery will take time and only serious investors will be benefitted who believe in long-term wealth creation through share market investing.