TCS stock has gained nearly ten-fold since its IPO in 2004 but lost +10% in just 3 days on 26 occasions since listing.
Bharti Airtel has gained 15 times since it was listed in 2002 but has lost +10% in just 3 days 28 times.Similarly,
HDFC has risen 18 times in the past 15 years. But there are 42 instances when it has dropped +10%.
ICICI Bank shares generated an absolute return of 755% in 15 years, yet there have been 72 instances when it has lost +10% over three days.
Not only large cap stocks, similar patterns are visible in mid to small cap stocks. Welspun India has increased 20-fold, but has lost +10% 127 times since 2001.
Rajesh Exports have risen nearly 220 times, but there have been 115 occasions when it lost +10% value in 3 days.
The Voltas stock has increased 76 times yet there are 92 instances of steep falls.
Can’t you figure out what mistake we are making?
We lack patience and often exit from stocks due to panic when prices drop steeply.
Greed drives us to the market and fear pushes us to cut losses and thus, ignoring the long-term fundamentals of a company.
*Therefore, Just stick for long in stocks where you have conviction *
Happy Investing !!