05 Nov The Lobster Story – Learn SIP from a Lobster
Lobsters are part of a large family of crustaceans. They have a hard exoskeleton shell.
In order for the lobster to grow, at various stages of its life, it must molt. In other words, it has to get rid of its old shell and start to form a new one.
So what you might say. Well for about 20-30 minutes the lobster is vulnerable whilst molting, it essentially becomes a piece of meat for other aquatic creatures on the prowl.
The Lobster knows this, and has taken certain precautions to try to stop them from being as vulnerable such as forming a thin skin before it molts, and changing colour.
However, for the most part they know that in order to grow larger they must get over their fear of being vulnerable and just shed their old shell.
In investing too we need to overcome our fear of markets and invest in equity despite of the volatility and the best method is investing through SIP.
Like when the lobster is changing it’s shell, it develops a thin skin and changes its colour, in the same way an SIP protects an investor during a market correction by buying more units which averages the cost.
But to grow, a lobster has to overcome the fear of other predators and go about the work of shedding its skin.
Investors too likewise should go about their work of sustaining their SIPs under any market conditions by overcoming the fear should they wish to grow their investment and quality of life.
Dharmendra Satapathy at NextLevel-Education