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 A teacher told her class to bring a bag of potatoes with each potato being given the name of whom the child hates. Some brought two potatoes, some three, while some even 20 potatoes. The teacher then told them to carry the potatoes with them wherever they go for one week. Days passed and the children started complaining due to the smell let out by the rotten potatoes. Those with 20 potatoes also had to carry heavier bags. After a week the teacher told them the meaning of the game: “This is exactly the situation when you carry negative thoughts for somebody. The stench contaminates you wherever you go. If you cannot tolerate the smell of rotten potatoes for one week, how will you carry the stench of negativity for lifetime?”

An analysis of the S&P BSE Sensex daily (1-Day) returns for the last 40 years indicates that out of the ~9500 trading days, 53% closed positive while 47% closed negative. For the last 20 years too, the ratio of positive to negative days is almost the same (See table for 10 most negative days in the last 40 and 20 years). Despite nearly half the trading days ending negative, the Sensex rose by 269 times in 40 years (15% returns) and by nearly 17 times in 20 years (15.2% returns)*. While naysayers will keep highlighting negatives, the index has still provided good returns to those who ignored the negatives and stayed invested over these long periods. We tend to focus a lot more on trying to ‘time’ the market to avoid negative zones and to stay in positive territory at all times. This mindset is a big reason for missing wealth creation. Remember not to bother about market negativity, but just stay invested across timeframes to create wealth.

Source: BSE 
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*Data as of Mar 31, 2022.