"Markets close at 20-month low", "Market crash wipes out lakhs and crores of investors' wealth," and many more such news items threw Vishal into frenzy. The optimism that was prevalent a year ago when he invested had vanished and he headed straight to his financial advisor.
"I want to withdraw my money right away," stuttered anxious Vishal. Offering Vishal a glass of thandai, the advisor asked him to calm down. He had faced such situations umpteen times and knew how to soothe Vishal's nerves.
He took him to another client Chandresh, who was readying a cheque for his next investment. The moment Vishal saw him signing on the cheque, he bombarded him with a flood of questions. "Investors like me are losing money and you are making fun of us by investing more," cried Vishal.
The advisor stepped in, "He isn't making fun of you. Years ago, he panicked just like you. But he learnt a lesson the bitter way. Inspite of recommending him not to sell when the equity markets cracked in 2008, he went directly to the mutual fund office and sold the units." He not just lost his money, but had to pay a hefty capital gains tax as he hadn't completed the one-year period for his equity MF investment.
