Real Threats in Financial Market & How to Overcome of it?

Even then many of the investors are still struggling to cope-up with the financial market up-down. This is not at all due to any outside factors but completely due to internal factors. These internal threats keep many investors away from their targeted goals.

This Article would help you all to understand the real threats in the financial market & also highlight the measures to overcome from such threats. Let’s dive into it.

• Real Threats:-
• Fear: –

As a human being what are the things we are not afraid of? If we start listing out then the list would just go on and on. Out of those fears, as investors, we fear losing money due to the down scenario of the market. Many can say it is a human tendency. We knew the reasons and factors about the down market, we had authentic data and even then we were trapped in a web of fear. It is not human tendency but an internal weakness which must be acted upon to overcome such weakness.

• No patience: –

Many things we gave up in life due to lack of patience. This is the time where we all are surrounded and bombarded by social media. Lots of information flooded & we were just unable to ignore it. We all got addicted to absorbing all the information on social media platforms which are coming towards us. So, many times due to wrong, misleading information, we just get impatient and take the decision.

Such impatience not only hampers our investment portfolio but it works as a hole to a boat which leads our boat to sink. This internal weakness also must be rectified.

• Lack of knowledge and understanding: –

The first threat of fear explained above in this article is the result of lack of knowledge and understanding. Many of us either don’t take the help of professionals and or completely depend upon them. These both extremes must be avoided. If an investor had knowledge of this field then he or she can make their own decisions independently without the help of professionals. However, over dependence on professionals must be avoided. Every investor must have at least basic knowledge & understanding of the financial market. The reason behind having basic knowledge would help investors to ask better questions to their professionals. However, knowledge and understanding must be from an authentic source. Don’t depend on social media university. Read good articles and watch podcasts from authentic sources and or join courses on it.

• No clarity: –

Most of the investors start their investments without any clear goals. And therefore, in the beginning only they start walking in the wrong direction. This wrong direction not only wastes your valuable time but also your hard earned money.

Having clarity on short term and long term goals would help you to choose the right investment plan and product.  Here the role of professionals comes into play. They help investors to choose the right plan and products as per their set goals. Therefore, as investors in the financial market, we must first have a clear set of goals. Due to lack of clarity we make wrong decisions. And if this should not happen in future, then we must be very clear about our goals.

Now, let’s understand about Measures To Overcome.

• Your foundation should be strong: –

Any big building and or tower had a strong foundation. Same is the case with human beings and dealing in the financial market. As investors in the financial market, we must build our foundation strong. Here foundation means getting knowledge, understanding, and clarity on short term & long term goals. Reading good articles from recognized newspapers or magazines. Learning from online or offline short courses. Attending webinars from authentic sources. All these things help us to build our foundation strong. Also whatever our investment portfolio would be, we must have at least six months to one year emergency fund with us.

• What to focus on or what not? :-

We are living in an era where social media is the most active part of our life. Day in – day out we are on those platforms. Due to such bombarding of information we become more confused. Rather than clarity we get into a trap of lots of information. It leads us to make wrong decisions. We can’t completely avoid social media but we must adopt a filtering approach. We must be able to filter out what information we need and which must be retained for future reference.

We also must focus on minimization rather than maximization. In a sense, we must not focus on maximizing returns but must be focused on minimizing the likelihood of failures in the financial market due to wrong decisions or indecision.

• Discipline: –

Discipline approach is required everywhere. So, the financial market is not an exception to it. We must build a disciplined approach towards our investments. Obsession to react or respond to every social media information must be completely avoided.

Here, I want to quote what Robin Sharma says about consistency. He says “Consistency is the mother of the mastery”. So, we must adopt a consistent approach while investing. We must keep regularity in our investments. Whether market up or down, we must keep going with our investments; if there is no urgency to withdraw from the market.

Hope this article serves you. Keep investing!

You can reach to me at rohanrp1983@gmail.com