A dissertation on Comparative Analysis of patterns in Humans choosing their mate and investors’ behaviour towards stocks.

A doctoral thesis

It is an uncanny similarity. Which came first ? Relationships or Investing ? There is a weird resemblance between the pattern in which man (including woman *) invests on the stock market and the pattern in which he (including she*) chooses his mate or shall we say- to be politically correct and inclusive- his significant other.

Some investors hold on to stocks because their grandfathers had bought them and had passed it down the generations. (Fair enough. Correspondingly, some men marry within the same family that their father married from. South Indian Mama or Athai’s daughter)

Some investors buy a stock and hold on to it for life. Fair enough, some marriages last a lifetime.
Some other investors invest for the long term. At an opportune moment (when the going is good), they sell-out booking long-term capital gain, now Tax-free. (alimony, did some one say…)

Some investors buy shares for the short term (less than 12 months) ! exit the investment once they see a more promising stock( booking short-term CG, tax only @ 10 %) ! (Pick up- Drop- Escape..)

Some investors are actually speculators. They Buy today sell tomorrow. They don’t even take delivery!!! (One night stand, anybody)…
And some do intra-day trading. That is, buying and selling within the day.
They even sell first and then buy!! (Oh oh !!!...

But every young man better know, that historically it is proven, that long term investments in carefully chosen equities create maximum, enduring value. Short-term gains are just that –short term and are taxed at higher rates. Constant speculation can lead to losses. Even if they don’t, the brokerage shelled out is likely to exceed the gains.

* Intrepretation to the General Clauses Act.