These are the three common mistakes:
1. Trying to time the market:
Khemka believes that trying to predict when to enter or exit the market is the biggest mistake investors make. People often react to headlines or global events by quickly selling their stocks or staying out of the market. But this strategy rarely works.
“You’d be fortunate to get it 50% of the time right,” he said, adding that emotional decisions based on fear or speculation usually led to poor results. He’s proud to say this is one mistake he’s personally avoided throughout his career.
2. Using borrowed money to invest:
The second mistake Khemka warns against is using leverage—borrowing money to invest in the stock market. When people don’t have enough money but want to earn high returns quickly, they are tempted to take loans and buy stocks.
“That’s a mistake I’ve made,” he admitted. While it might seem like a smart move when interest rates are low and stock returns are high, Khemka says this approach can backfire badly, especially when markets fall.
Also Read: This $2 trillion global fund is ‘max overweight’ on India
3. Putting all your money in just one or two stocks
Khemka’s third warning is about over-concentration. He shared an example of someone who invested all their money in biotech stocks simply because they liked the sector, even though they had no expertise in it. “That’s like buying a lottery,” he said.
Khemka advises against putting too much faith in one theme or sector, no matter how promising it looks. Diversifying across different companies and industries helps reduce risk.
Khemka believes the best way to invest is to stay disciplined: don’t try to time the market, avoid borrowing to invest, and spread your money across different types of companies.
Also Read: Manishi Raychaudhuri says market correction not done yet, brace for another dip
For the entire interview, watch the accompanying video
(Edited by : Shweta Mungre)
