Investing in Mutual Funds the Virat Kohli way

Pic credits:

Virat Kohli has been one of the finest craftsmen the game has been blessed with, the finest?

Well that’s a debate we do not want to get into, for the time being though let’s try and analyze how his approach towards the game is something we can all inculcate in our very own outlook towards investing in Mutual Funds.

"In general, we keep looking for goals in life. Generally as human beings we look to achieve something in work, be it any profession. Do something which is in my control mentally" 

Goals: Wanting to be rich is not a goal, it’s a generalized desire most, if not all of us aspire. You are more likely to day dream when you have a dream rather than when you have a goal.

On the other hand when you have a goal you are most likely to have a plan and take steps towards that goal. Goals have to be personalized and not generalized.

It also helps you stick it out when the going gets tough. Knowing why you started will be your biggest strength when you ponder over abandoning your goals midway.

Let’s say you are investing towards your child’s higher education abroad and have a 10 year horizon for the same. You do not abandon the same in case your child falters in one exam but in case the markets are seething for a year then the thought of halting the investing process does cross your mind.

This is when having a goal helps, you had a 10 year time horizon so then why would go astray say within the 3rd or 4th year itself just because the markets have seen a blip?

When you have a goal, you know where you are headed and why. 

If you can wait for your child to grow then why can you not wait for the very Mutual Funds to grow too that were planned for his future benefits?

Control: It’s our innate nature to worry about things we cannot control and yet that serves no purpose. You cannot control how the market behaves but you can always control your behavior towards it.

Note how the word mentioned here is ‘’behaves’’ and not ‘’reacts’’. You have to be proactive and not reactive in order to avoid self-sabotage.

What you can control
Your greed
Your behaviour
How much you can invest
How long you can stay invested etc

What you cannot control
Change in Fund Manager
Change in Fund Strategy
Market Behaviour

And yet returns is what we are obsessed with even though it is beyond our control. This is not to say returns do not matter but when you focus on things that are within your grasp, you tend to worry less about the things that are not within your control. There are no guarantees in life and investing in Mutual Funds is no different but when you focus on the fundamentals the results tend to take care of themselves.

‘’I usually target to finish it 2-3 overs before. That is the way I plan my innings.’’

Time Horizon
Investors with long term goals often make this rookie yet common mistake. If you have a goal that requires 12 years to accomplish it then you need to plan to stay invested for 10 years and not 12, let’s try and understand this further in detail.

Now let’s say you indeed had a 12 year time horizon and needed the same corpus in the 12th year, now in the very 12th year the markets see a correction and your investments take a hit. The thing though is, you had planned your Mutual Funds investment and time horizon in such a way that delaying the redemption amount is not feasible for you so therefore you have no option than to redeem your investments at a low.

Now in case you had planned for 10 years and the very year the markets see a tumble, you can still stay invested for another 2 years since the corpus would be needed in the 12th year so therefore you still have another 2 years as grace period during which you can redeem as and when the markets are in the green.

When it comes to investing in Mutual Funds, be a Kohli and not a Dhoni, finish it off 2-3 years before you need to. 

There’s no need to take it till the last over, bravado has a heavy price to pay when it comes to investing in Mutual Funds.

‘’ You just can't go in one mode. I think it is a balance of being aggressive."

Pic credits:

Believe in yourself but there’s no harm in taking precaution, hope for the best but prepare for the worst. Yes it sounds boring and old school but it gets the work done so there’s no need to reinvent the wheel.

It’s one thing to be confident in yourself, it’s another to be over confident.

The market does not take kindly to ego and pride so it would be advisable to leave those at the door.

The market rewards what you deserve and not what you desire.

You cannot randomly declare yourself to be an aggressive investor, your risk assessment can do that. Remember risk appetite and risk tolerance are not the same thing.

Risk appetite signifies how much you can invest whereas risk tolerance signifies how much of a hit can you tolerate and still not panic,the stock market is a place where your EQ is more valuable than your IQ.

You need to strike a balance between aggression and caution, you cannot test the waters with both feet. Often novice investors in the past have put their entire life savings into Mutual Funds on the basis of some hot tip and have lost dearly. You need to set aside your emergency corpus and also account for daily and monthly expenses among other various other important things.

You would also need to look at possible negative scenario that may arise in the future, say a sudden job loss and also cater to your debt needs. You cannot be completely invested in equities, if you cannot imagine a scenario where you see yourself invested for a minimum period of 5 years then mutual funds are not for you.

‘’If you want to be consistent, you need to be boring with your training, your food and your batting habits.’’

Habit: You cannot one fine morning decide to run a marathon. You would have to practice for days and at times even months in advance. You would need to make sure you build up endurance over a period of time to give your body the best possible chance not to break down.

The issue with habits in any walk of life is that they can be extremely boring, that can be very challenging to endure in a very fast moving life.

Social media does not help either where every alternate day you come across headlines like
‘’Best Schemes to invest”
‘’This scheme gave the highest returns’’ and so on

Make sure you keep one thing in mind when you scroll on social media and come across various success stories of wealth generation:

No one is rushing to post their failures 

With Mutual Funds you have to be ready to be boring and imbibe the same old but proven principles of discipline, patience, avoiding noise and so on.

The itch to tamper with your portfolio will always be high, it will be the highest when the markets are down.

If you cannot continue your SIP’s in Mutual Funds for a minimum of 5 years and stay longer than that then Mutual Funds are unfortunately not for you.

There’s no shame in accepting and staying out, it is any day better than losing your hard earned money over your pride.

‘’ I felt like I could hit every ball of the first over from Tim Southee for a six. But I stopped myself because I don’t want to disrespect the sport.’’

As previously mentioned, investing in Equity Funds means staying true to certain principles  like

      a)  Patience
      b)  Discipline
      c)  Avoiding outside noise and so on

At times though, we have seen far too many investors trying to reinvent the wheel and experimenting with their hard earned money.

Learn the rules before playing the game and when you do, respect them 

The greatest of them all, irrespective of what field they belong have strong attachment to principles and ethos.

You cannot expect money to pay you back if you do not respect it.

You do not need to emulate exactly what another successful does, in fact that can prove counter- productive. We all have varying situations but there’s absolutely no shame in learning from others though.

The links to interview from where quotes have been picked can be found below

Virat Kohli on respecting Cricket

Got some questions ? We've got the answers, 
email us at
Disclaimer : While due precaution has been undertaken in the preparation of this article, The Mutual Fund Guide or any of its authors will not be held liable for any investments based on the above article. The above article should not be considered financial advice and has been published only for your perusal. Due credit has been given in case wherever required, in case you feel any part violates any rights then do get in touch with us and we shall get it duly removed.  
Mutual Fund investments are subject to market risks. Please read the offer document carefully before investing

Copyright © 2019  The Mutual Fund Guide, All rights reserved.

My Instagram