What is beginner's luck ?
Wikipedia defines it as -
“Beginner's luck refers to the supposed phenomenon of novices experiencing disproportionate frequency of success or succeeding against an expert in a given activity.
The industrial behemoth has been the darling of the market in the ‘80s and ‘90s, but has disappointed its investors in the last decade. The share price has hardly doubled from its 2007 levels, offering a CAGR of paltry 7% to the investors. On 31st March 2007, the share price was Rs 730, and on 23rd june, 2017, the share price is 1432 with a minuscule dividend yield. During the same period, Sensex has given a return of 9.1%. So, Reliance has even under-performed the index by a good 200 basis points. The fact that the dividend yield has been meager as well, sums up that reliance industry has only caused disappointment to the investors in the last decade.
Let us analyze why this has been the case -
First things first, Can you lose money by investing in mutual funds ?
Practically - "No"
Mutual fund, like any other equity market instrument, depends on the market conditions. There is no guarantee that even a fraction of what you invest is 100% safe. So if you want absolute safety, then mutual fund is not for you.. Period.
Planing to start investing stocks on your own? I am Glad you landed up here..
What's your biggest worry when you are about to meet a few strangers?
Your biggest asset and your biggest enemy is your own brain !
Efficient market theory states that the price of all stocks trading in the stock market is already priced in, so you don't need to actively research about the stock because every good news or bad news that could possibly be there is already reflecting in the stock. So basically, nobody can beat the market because the pmarket has already processed every bit of information. The possibility of outsmarting the market is considered impossible by this theory.