{"id":4142,"date":"2025-04-09T09:45:29","date_gmt":"2025-04-09T09:45:29","guid":{"rendered":"https:\/\/nrimoneyclinic.com\/V1\/?p=4142"},"modified":"2025-05-17T09:46:09","modified_gmt":"2025-05-17T09:46:09","slug":"a-bend-in-the-road","status":"publish","type":"post","link":"https:\/\/nrimoneyclinic.com\/V1\/a-bend-in-the-road\/","title":{"rendered":"A Bend in the Road\u2026"},"content":{"rendered":"\t\t
\n\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t\n

Aashish P Somaiyaa<\/strong><\/p>\n\n\n\n

Executive Director & CEO, White Oak Capital Asset Management<\/strong><\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

\n\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

The Nature of Markets: Predictably Unpredictable<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Over the last 25 years that I have experienced in asset management, one truth has never<\/span><\/p>\n

changed; markets are full of surprises. You think they\u2019ll rise, they fall. You fear they\u2019ll crash,<\/span><\/p>\n

they rally. Many investors try to \u201cfigure it out,\u201d hoping for some formula or certainty. But the<\/span><\/p>\n

truth is: markets are not machines with defined inputs and outputs. They are living<\/span><\/p>\n

ecosystems, influenced not just by earnings and interest rates, but by human behavior\u2014full<\/span><\/p>\n

of emotion, psychology, and reactions to the unknown.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

When I say \u201ca bend in the road is not the end of the road,\u201d I don\u2019t say it for dramatic effect. I<\/span><\/p>\n

say it because it is a deeply profound way to look at investing. A bend doesn\u2019t signal the<\/span><\/p>\n

journey\u2019s over\u2014it signals a change in direction, a moment to stay alert, not panic. It\u2019s during<\/span><\/p>\n

these moments of uncertainty that true resilience and adaptability are tested\u2014and often<\/span><\/p>\n

Rewarded.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Bends Are Features, Not Flaws<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Let\u2019s be honest\u2014if there were no bends, there would be no roads. A road that\u2019s perfectly<\/span><\/p>\n

straight and unchanging doesn’t exist and if it were, we would give up on such a journey out<\/span><\/p>\n

of sheer boredom or the feeling of being directionless and getting nowhere at the end of an<\/span><\/p>\n

what seems like an endless journey. Just like in life, in the markets too, change is constant.<\/span><\/p>\n

The problem is, we often see bends as something to fear rather than something to navigate<\/span><\/p>\n

and possibly find key milestones around the corner.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Just imagine if an ECG showed a flat line\u2014it would be a cause for alarm. Similarly, a market<\/span><\/p>\n

without volatility, without ups and downs, is either dead or manipulated. Volatility, like the<\/span><\/p>\n

curves in a road or the waves in an ocean, is a sign of vitality.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Markets Swing Like a Pendulum, Not a Line<\/span><\/p>\n

\u00a0<\/b><\/p>\n

People often visualize markets as moving in straight lines: up = good, down = bad. But that\u2019s<\/span><\/p>\n

not how markets work. A more accurate model is the pendulum. When it swings far to one<\/span><\/p>\n

side, it stores energy. The further it goes in one direction, the stronger it swings to the other.<\/span><\/p>\n

In investing, this shows up when everyone is euphoric\u2014returns become compressed, and<\/span><\/p>\n

risks are high. When everyone is fearful \u2014 values become compelling, and the potential for<\/span><\/p>\n

future returns improves. But few see it that way at that moment.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Stop Seeking Absolutes\u2014Learn to Think in Probabilities<\/span><\/p>\n

We live in a world where people demand clarity: \u201cWill the market go up or down?\u201d \u201cWhich<\/span><\/p>\n

fund is best?\u201d Unfortunately, in the world of investing, there are no certainties\u2014only<\/span><\/p>\n

Probabilities.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

I often joke that human beings are deterministic\u2014they want clean, binary answers. But the<\/span><\/p>\n

world operates in shades of grey. We want black-or-white answers to questions that don\u2019t<\/span><\/p>\n

have them. In reality, <\/span>the successful investor is not the one with absolute clarity,<\/span><\/p>\n

but the one who is open-minded and probabilistic.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Behavior Trumps Knowledge<\/span><\/p>\n

\u00a0<\/b><\/p>\n

It may surprise you to know that the Nobel Prize in economics has been awarded\u2014thrice \u2014<\/span><\/p>\n

not for theories of interest rates or supply and demand, but for<\/span> studying human<\/span><\/p>\n

behavior.<\/span> Why? Because investing is not an academic exercise. It\u2019s an emotional one. The<\/span><\/p>\n

stock market is the longest running live experiment to study human psychology.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

In March 2020, many investors were convinced that the world was ending. Everything<\/span><\/p>\n

pointed to doom. The market collapsed over 35% in just weeks. Yet, the ones who kept a<\/span><\/p>\n

window open in their mind to possibility, who reminded themselves of humanity\u2019s ability to<\/span><\/p>\n

adapt, were the ones who built wealth.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Fast forward to late 2021, and the mood had completely reversed\u2014now it was \u201cAmrit Kaal.\u201d<\/span><\/p>\n

Same people, same world\u2014radically different outlooks. Why? Because moods swing. We are<\/span><\/p>\n

emotional beings, and markets reflect that.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

You Don\u2019t Need Perfect Timing\u2014You Need Participation<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Here\u2019s something from my early days in Mumbai: If you want to go from Goregaon to<\/span><\/p>\n

Churchgate at 7:30 AM, you won\u2019t get the perfect train to get your fast to Churchgate, most<\/span><\/p>\n

fast trains don\u2019t stop there and any that do are over-crowded. Sometimes you board the train<\/span><\/p>\n

that goes in the opposite direction first, get a seat at Borivali, and then continue to head in<\/span><\/p>\n

the right direction more comfortably and assured of safe arrival at the final destination.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

In investing too, the perfect entry point doesn\u2019t exist. Markets don\u2019t toot a horn before going<\/span><\/p>\n

up. If you’re waiting for the \u2018right moment,\u2019 you might just miss the train altogether.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

The Escalator Metaphor: Wealth Creation is Frictionless, If You<\/span><\/p>\n

Stay On<\/span><\/p>\n

\u00a0<\/b><\/p>\n

If you simply <\/span>step onto an escalator<\/span>, you rise. Our economy is like that\u2014over the long<\/span><\/p>\n

term, GDP grows, earnings grow, and markets follow. If you had done nothing and stayed<\/span><\/p>\n

invested since liberalization, your wealth would\u2019ve doubled every 5\u20136 years on average<\/span><\/p>\n

Yet, how many people actually double their money every five years?<\/span><\/p>\n

Why don\u2019t more people benefit from this upward movement? Because they jump off. They<\/span><\/p>\n

overthink. They fear. They wait. Or worse, they try to come down the escalator that is moving<\/span><\/p>\n

up. When markets don\u2019t move or move down for a bit, people think they will get off and get<\/span><\/p>\n

back later. When markets rise people show the urge to rise faster.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

The Wiper Effect: Chasing What Worked Yesterday<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Many investors behave like windshield wipers. They swing from one side to the<\/span><\/p>\n

other\u2014buying what’s worked recently, only to abandon it when it stops working.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Last year, pharma was hot. Before that, it was PSU banks. This year, it might be autos or<\/span><\/p>\n

defence. Every time you chase the latest winner, you risk arriving late. The best-performing<\/span><\/p>\n

sector or fund of the past often underperforms going forward.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

What you should really seek is <\/span>consistency, not peak performance<\/span>. Find managers,<\/span><\/p>\n

funds, and strategies that steadily do well\u2014not the ones who are only occasionally at the top.<\/span><\/p>\n

Investing and asset allocation is about optimizing, it is not maximizing. Often, Mr. Market<\/span><\/p>\n

minimizes people who try to maximize. So optimize, that\u2019s the way to stay in the game and<\/span><\/p>\n

reach your goals.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Compression Builds Energy\u2014Like a Spring<\/span><\/p>\n

\u00a0<\/b><\/p>\n

When prices fall, investors panic. But just like a compressed spring stores energy, a<\/span><\/p>\n

falling market sets the stage for outsized returns. A well-diversified, fundamentally strong<\/span><\/p>\n

portfolio that has fallen in price hasn\u2019t lost its intrinsic value.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

In fact, it has become more valuable. This is not theory\u2014it\u2019s physics.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Real Intelligence? Holding Two Opposite Ideas at Once<\/span><\/p>\n

\u00a0<\/b><\/p>\n

F. Scott Fitzgerald once said, <\/span>\u201cThe test of a first-rate intelligence is the ability to hold two<\/span><\/p>\n

opposed ideas in the mind at the same time, and still retain the ability to function.\u201d<\/span><\/p>\n

\u00a0<\/b><\/p>\n

That\u2019s what investing demands. Can you believe that things look bad today\u2014but still imagine<\/span><\/p>\n

that they\u2019ll improve? Can you recognize risks\u2014without being paralyzed by fear? That\u2019s what<\/span><\/p>\n

it takes.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Final Thoughts: Don\u2019t Seek Clarity, Seek Preparation<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Many investors ask their advisors for clarity: \u201cTell me what will happen.\u201d But no one can.<\/span><\/p>\n

What a good advisor can give you is preparation, not prediction.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Markets will always surprise us\u2014sometimes for the better, sometimes for the worse. The<\/span><\/p>\n

right lesson to learn from surprise is not \u201cNext time, I\u2019ll be ready.\u201d It\u2019s \u201cThe world is<\/span><\/p>\n

inherently surprising, and I will remain prepared for whatever comes.\u201d<\/span><\/p>\n

\u00a0<\/b><\/p>\n

To the Long-Term Investor:<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Markets move like a rising sine wave. Each dip feels like doom, but it’s part of the ascent.<\/span><\/p>\n

Every past correction looks like a missed opportunity in hindsight, March 2020? Missed<\/span><\/p>\n

opportunity in 2022? Perhaps April 2025 will be one too.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Don’t be the one watching from the sidelines. Don’t overthink the bend. Don’t chase, don\u2019t<\/span><\/p>\n

fear. Just stay on the road. Stay invested.<\/span><\/p>\n

\u00a0<\/b><\/p>\n

Because a bend in the road is not the end of the road\u2014unless you are inflexible, sleeping at<\/span><\/p>\n

\u00a0<\/p>\n

the wheel and fail to turn.<\/span><\/p>\n

\u00a0<\/span><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

Aashish P Somaiyaa Executive Director & CEO, White Oak Capital Asset Management The Nature of Markets: Predictably Unpredictable \u00a0 Over the last 25 years that I have experienced in asset management, one truth has never changed; markets are full of surprises. You think they\u2019ll rise, they fall. You fear they\u2019ll crash, they rally. Many investors […]<\/p>\n","protected":false},"author":1,"featured_media":4148,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[121,100],"tags":[],"class_list":["post-4142","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles","category-investments"],"acf":[],"jetpack_featured_media_url":"https:\/\/nrimoneyclinic.com\/V1\/wp-content\/uploads\/2025\/05\/Article-1-1.png","_links":{"self":[{"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/posts\/4142","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/comments?post=4142"}],"version-history":[{"count":4,"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/posts\/4142\/revisions"}],"predecessor-version":[{"id":4147,"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/posts\/4142\/revisions\/4147"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/media\/4148"}],"wp:attachment":[{"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/media?parent=4142"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/categories?post=4142"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/nrimoneyclinic.com\/V1\/wp-json\/wp\/v2\/tags?post=4142"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}