Hyderabad: When we watch T20 cricket on TV, we tend to think the matches look easy to play. But in the real field, it is an altogether different ball game that requires presence of mind coupled with confidence and precision. A strong lineup of batting and bowling is needed to win matches. Similarly, a strong lineup of investment plans is needed by setting right goals with a sound financial plan in order to reach destination - success.
Like in cricket, we need strategies and planning to score the most out of our investment portfolio. Only when the lineup of all the 11 players in the team is strong, they can improve their winning chances. If all eleven are either great batsmen or great bowlers in a particular team, it will not help. A right balance is needed. Just like this, a similar diversity should be there in selection of plans while investing our hard earned money.
It is not wise to solely rely on one single batsman. Similarly, we should not depend on one investment plan. Instead, a variety of plans are needed to invest in companies' shares, term bonds, equity funds, deposits, gold and so on. Defending the wicket is a key strategy to stay in the field but an overdefensive tactic may prove counterproductive. So, overdefensive investments in deposits and savings will not yield results as inflation will erode our returns.
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In short version of 20 overs cricket, power play overs play a crucial role where opportunities are high to hit fours and sixes. Life chances will turn the game around in any phase. We get similar chances during the course of making investments. During market collapses, good shares may come within our reach and they should not be missed. Runs should be scored in a steady manner. Likewise, investments should be made in a systematic way.
Usually a target score of 220 would be set for 20 overs matches. It may look difficult to crack, bringing pressure on batsmen, forcing them to choose offensive play to get runs. In a hurry, they give away wickets. Many investors make similar mistakes by trading to get high returns without bothering about their original financial plan. In the end, they lose. When the target is high, we should chase it in a disciplined and systematic way.
It is very important to score maximum possible runs in the initial overs in T20. In the same way, maximum possible amount should be invested once we start getting income. One bad over will change the tone and tenor of a game. One bad policy is enough to disturb your entire investment portfolio. It will have an adverse impact on your overall returns.
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Many distractions occur during play but a cricketer should keep strong focus. An investor should show similar focus to overcome hurdles and reach his financial goals. When nearer to target, one should play cautiously. Once we get expected returns, we should play safe by shifting our funds from risky plans to safer ones. Financial experts are like coaches to cricket teams and they play their own role in bringing success. Though 11 members play, four others will be there in the team. Like that, we should have a contingency fund enough to cover our expenses for six months to one year.
