Ingredients for Investment success :

Every aspiring investor assume that investing in the right stock is key to investment success. No doubt. Unless the underlying stock you invest is right, your investments cannot sustain its growth.

But Investing in the right stock at the right time and staying invested (patience) is crucial to Investment success. And when we call it as the right time - many investors look back and easily identify the lowest price point as the right time to invest. But in reality, no one knows when is the right time to invest - today, tomorrow or the day after. 

Adding fuel to the fire is the research reports of various investment bankers and stock brokers. They come out with an investment call on the stock. And all business channels keep flashing the BUY tag of these investment research desks and analysts. Above all is the so called technical analysis who keep giving the levels to invest.

And all those who watch these reports / business TV channels scramble to buy these stocks. As a result there is a buying pressure and the stock price rises. But the next day these research analysts and TV channels identify a new investment idea - only to forget those stocks debated the day before. As a result the glamour diminishes and buying pressure eases - resulting in fall in stock price. 

And the worst part is many investors who bought these stocks fail to notice these phenomenon and end up holding these stocks blindly. They are not sure if they should book loss or hold on to these stocks. Technical analysts come up with the beautiful concept called STOP LOSS, which means if the stock price breaches a level, you need to cut your loss and invest in a new investment idea.

Here is a LIVE case study of this phenomena:

• On 30th April 2018, a reputed investment research house releases a report on a company called JK Paper. The tag line says "In a sweet spot...". And the reports is summed up with a TACTICAL BUY on JK Paper at Rs.142 for a price target of 195. 
  
• No doubt the buying craze lifted the stock price to 149 in the next one week.After that the stock price was not noted and it fell down all the way to Rs.99 on 19th July 2018.
• Those who bought it 142 would have felt cheated. The would have lost the trust in the investment research house which published this report. 
• Many even get confused if the fundamentals of a company matter with respect to its stock price movement. But the fact is, many investors read only the current price and price target. They are least bothered about the content of the report.
• Had they read the report and understood the investment rationale, they might have invested at lower levels. And investing in a falling market is not that easy. Many investor panic and get paralyzed.
• Today at Rs.171, those who bought at Rs.142, stands at a profit of 20%. But the real bumper profit would have been reaped by those investors perfectly timed and invested at Rs.99 would have made a killing return of 70% in these four months. For that, one needs to really be lucky.
  

• Practical Investors are those who kept investing gradually as the price keeps falling. Though they would not get THE BEST Return, they would have got a better return when compared to one time investing. 

Hence the recipe to investment success is : 

• Identifying Good company / business + 
• Incremental investing when stock prices falls + 
• Holding on to your investment till the tide turns (patience). 

Many investors aspire to invest at rock bottom price and hit a bumper. As a result they keep waiting and miss out investing in such moments. Hence it is better to believe in hard work and discipline rather than on blind luck!