‘Risk’ – Inspires Luck

‘Risk’ – Inspires Luck

Nothing new comes out of being ordinary. It is impossible to produce superior performance unless we do something different from the majority.

Life canvas is large which can be painted with our great deeds. However, to attain higher altitudes of glory we have to get consumed by our ideas, breach the comfort zones, take calculated risk and work hardest towards the mission.

Whether it means overcoming fear to perform on stage, proposing the sweetheart we like or investing in new business ventures; some of the life’s most rewarding experiences come as the result of taking risks.

No outcome is ever cent percent certain, margin of risk always exists and the quantum of risk increases when the stakes are higher. If we regularly dine with cannibals, we run a risk of being eaten by them. Therefore, take risk but not brute one; but an informed one, look before you leap, calculate before you move. Also, ensure someone is giving you safety cover as the risk is a shifting illusion.

Thought of failure scares! However, failure builds character, makes us stronger and more resilient. People who fail repeatedly, develop persistence in the face of difficulties. Failures need to be embraced upon, learned from and moved on. Abraham Lincoln had lost eight elections, had failed in business twice and suffered a nervous breakdown all before becoming one of the greatest American presidents.

Confidence is an important attribute which risk-takers have in them. Confidence is a learn-able skill, a make-believe thing i.e. we have to keep telling self that we are not scared, that we have all the courage and confidence needed to take risk. We can develop confidence by equipping ourselves with the knowledge and skills needed to achieve a mission.

Sometimes, in quest of wonderful gains we may have to take the road less travelled, and it could be a scary road to take as that may not have yet been mapped. Therefore, the things we really have by our side in the hope of reaching our destination are- our intelligence, perseverance and luck.

Figure out the most intimidating things about the big risk we are about to take. We need to do thorough home-work on the subject in order to better insulate ourselves from unfavorable resultant. Also, we need to know when to change the course and not keep sticking to our first goal as we would have invested so much of time and effort. We must know when it’s time to quit and restart with renewed vigor on the newer path.

In wealth multiplication, we risk losing some or all of the money we have invested in the business or in the financial instruments, due to- volatility, inflation, defaults, concentration risk, unfavorable regulatory changes or other market dynamics.

We may choose to make investments that guarantee safety by offering fixed rate of return, with near zero default risks viz. sovereign bonds. However, the price for this safety could result in a very low return on our investment, coming as a trade-off with an opportunity to earn higher returns if we were to take higher risk of investing in instruments like Mutual Funds or Direct Equity. ‘In investing what is comfortable is rarely profitable’.

Wise thing to do is to take calculated risk by gaining skills and knowledge of the subject. We should not over leverage, must do credibility check of the companies and the issuers of financial instruments, and cleverly diversify our investments across different asset classes and sub-classes within each asset class to earn handsome return. We need to know the rules of the game we intend to play for sure, in order to succeed.

Accustomed to taking risks, would move us away from the mediocre way of thinking and living. Instead of limiting within the cocoon of so called safety, we gain the momentum needed to reach out for newer opportunities in our career or business. Risk builds our self-confidence and self-respect, empowers us to feel stronger. Take the risk as that shall get us some of our biggest rewards of life.

Mistakes need to be made if we want to succeed and that brings lot of learning. If we’re not making mistakes then we’re not trying enough things. Venturing out is a risk meeting an accident, to strive for higher is a risk of fall, to cry in the crowd is risk appearing fool and to live at all is risk being dead. However, risk we must, because the biggest risk of life is to risk nothing. In other words, we’re not living enough.

I close this article with a line of ‘Iveta Cherneva’- “Only those who play win. Only those who risk win. History favors risk-takers. Forgets the timid. Everything else is commentary.” 

Author: AJIT SINGH

FRUGALITY - Leads to Riches

FRUGALITY

Leads to Riches

Four cornerstones to become wealthy are -Greed, Frugality, Investments and Risk taking ability.

As per ‘Edmund Burke’, Frugality is based on the principle that all riches have limits!

Money can only be amassed by being frugal. However, frugality should not be equated with being miser or cheap; as it is a prudent and graceful behavior by all means! It means being economical, knowing how to get the best things at the least cost, priorities spending, stick to the budget and lead a well organized life. Frugal people are not emotional or impulsive in spending money and enjoy life within their means.

To save on the electricity bill, a frugal would set the timer of air-conditioner in his room in such a way that the AC automatically turns off within few hours of cooling. They switch off the lights and fans no soon they would leave the room. Frugal people would match the size of the vessel with the quantity of eatable before heating it, in order to conserve cooking gas and save money. At the same time they would appreciate good service rendered by paying tip to a waiter.

Frugal people are generally great negotiators. If they decide to buy a high-end car or house, they would do proper home-work about the product specifications and value it would offer in terms of utility, quality and reliability. They would meet various suppliers of the said product in order to extract best possible deal.

On the other hand, a miser person practices extreme form of frugality, which is often undesirable. They have only one philosophy in life, ‘Save money at any cost’. Leave aside comfort and luxuries which are not even a distant dream for the misers; they would even compromise in meeting the basic necessities of life such as food, clothing and shelter for themselves and their family members. They would act selfish and look at living by the means of others like a parasite, default on loan repayments with an intent to defraud and perhaps buy cheapest products ignoring quality. However, as said by ‘Benjamin Franklin’, misers must understand that, ‘the bitterness of poor quality remains long after the sweetness of low price is forgotten’.

Warren Buffet is considered as a frugal person who still lives in the same home he bought for $31,500 in 1958; his net worth is $61.1 billion. Mark Zuckerberg, whose net worth is $51.1 billion, drives Black Acura TSX, a car valued just around $30,000.

Whereas, Ms. Hetty Green, nick-named ‘The Witch of Wall Street’ is considered miser.

Hetty Green was a shrewd business woman with a nose for investments and a cool head for shares. In 1864 she inherited $7.5m (about £107m in 2010), but barely touched it, relying on her own banking prowess instead. Extreme stinginess had earned her a place in the Guinness Book of World Records as ‘World’s Greatest Miser’!

Allegedly, she never turned on the heating or hot water, constantly wore one old black dress which was only ever washed at the hems to save on soap. The most outrageous tale of her thriftiness, though, is that of her son and his broken leg. She initially refused to pay for medical treatment, resulting in a condition that later required amputation!

A frugal person doesn’t count small expenses on taking care of others as an extra expense, rather they consider it as their responsibility as a human being. On the other hand, a miser would consider every expense as burden, if they see no gain in return.

Every frugal person, no matter what they do, would always take only what they deserve and would never be unethical towards anyone; whereas, a miser would exploit others. We would have heard of people who put their own hair intentionally in the dish served, just to have free food in a restaurant, these are class a part misers and such act would certainly be considered cheap.

Frugal people spend more time on creating value out of their money and are generous in helping others if they can afford it.

So, let every desire not be a need.

Be Frugal To Be Rich

AJIT SINGH

The Greed - Is an essence of Evolutionary Spirit.

THE GREED

Is an essence of Evolutionary Spirit

Greed or avarice, is an inordinate or insatiable longing for material gains, be it money, status, power or other non-material things such as love, happiness, peace, knowedge, self actualisation and salvation.

Greed has been considered as the root of all the evils and has been strongly condemned by most of the religions. However, when it comes to love for money making and wealth creation, it is nothing less than the second religion for many. It won’t be preposterous in saying that the greed is in the genesis of evolution from the caveman to modern man.

'Renouncement of greed is your path to salvation', is the biggest pretence of modern day saints and preachers, who continue to live out of world class facilities and call it Kutiya (hermitage), take luxurious modes of travel and reward themselves with rich food!

How greed of rich  & famous to acquire more power, wealth and position, is different from that of those souls who are always in quest to seek more knowledge to become authority on the subject or people with strong religious beliefs doing more penance to attain enlightenment, and  the donors donating more to secure place in the heaven after life?  Also, can these pious souls explain who would do the charities for their noble causes, if there were no creation of wealth happening by the wealthy- so called greedy and money hoarders?

Driving force behind any big achievement in the field of business, education, science & technology, art, music, and exploration of universe is nothing else but, ‘greed’ of human beings to know more, be more and grow more. Greed is the only consistent human motivation, which produces preferable economic and social outcomes most of the time and under most conditions.

Altruism may attract our admiration, but it is greed that our society encourages and rewards, and it delivers the goods and riches on which we depend. Poor may dislike rich, but at the same time dream to become rich; and it’s this greed that paves the way in turning their wheels of fortune.

So embrace avarice without feeling embarrassed. Let’s not be ashamed of being greedy as that is an essence of evolutionary spirit. It determines how competitive we are over others and that we deserve better respect over others by virtue of our distinctive achievements.  

Powerful individuals, institutions, vast business empires, stock markets churning trillians and capitalism powered progress would not function without the ever growing greed for profits.

However, let the greed be not like a misguided missile, as that may cause irrational exuberance  and create those asset bubbles, which when burst would lead to great depression kind of financial crisis in the world and in the lives of individuals.

AJIT SINGH