He made a loss of 8 million in the stock market, later built a business with 10 million customers

“I have lost” 8 million in the stock market crash in 2008, which was eye-opener. Before 2008, the markets were on the rise! While the FD rates were 7-8%, the markets were giving very high returns (2% return per month, around 24% annually). This is the reason why everyone started investing heavily,” Lakhotia said.

He said friends would compete against each other to see who made the most returns. At that time, investing was purely based on tips.

“But when the crash happened, I realized I didn’t know how the market worked — how analysts evaluate company performance and make stock recommendations,” he said.

Instead of running away from the market, he decided to learn how it works and make up for his losses.

He saw how everyone in India loves to talk about the stock market and is eager to find the right opportunities and invest, but they lack the understanding to understand the technicalities like entry and exit timings. No wonder, despite having the largest working population with decent literacy levels, only a fraction i.e. less than 4% of India’s population actually invests in financial markets.

This journey of losing money in a market crash, and recovering it from the markets became a strong foundation for why it created StockGrow today.

StockGrow’s Lakhotia follows some basic rules for investing

Always diversify and hedge your portfolio.

– Use a top-down approach to determine which sectors will perform well and why, which companies in this sector are the most reliable, the company’s past dividend record and promoter background.

– Place a 2% stop loss and more importantly a 5% book profit target on all trades.

How people can manage their personal finances

Most people have money management on autopilot. They save a certain percentage (usually 10% to 20%) of their earnings in fixed deposits and spend the rest.

According to Lakhotia, the general rule is that after 20 years of work, your investment should provide you enough annual returns to support your lifestyle.

Like other market experts and analysts, Lakhotia also believes that you should invest very early in life because at that time your risk appetite is higher and your personal lifestyle costs less – as you get older. and your family responsibilities increase, your risk taking ability decreases.

Stockgro’s CEO’s Wealth Management Mantra

50% – Expenses

20% – FD Savings

30% – Stocks, Mutual Funds

Advice for long term investors

FD savings of 20%

30% investment in shares/mutual funds,

In his opinion, one should invest in products that you love and believe will be sustainable in the long run, regardless of boom and bust cycles.

So what are the areas on which long-term investors should bet?

For example, toothpaste and soap are unlikely to die and will continue to pay dividends.

Auto sector and logistics will grow and expand in future.

Banking and financial services sectors are bound to grow with the growing economy.

For long-term investments, choose good dividend-paying stocks that experience low volatility when results are declared.

Advice for short term investors

Choose momentum for short term investment shares In which investors see traction due to current developments in the company or sector, such as regulatory changes, new product victories, etc., that change the company’s perception of future earnings.

Ajay, who is an entrepreneur at heart and an investor in Aatma, said that such stocks can be traded for a short period of time ranging from 7 days to 3 months with strict stop loss.

“For example, the National Logistics Policy is expected to transform this sector and provide several incentives. Leading hi-tech logistics companies will benefit the most, resulting in an increase in their stock prices,” he said.

He also cautioned investors, saying that as the stock price moves up, adjust your stop loss to 2% of the current price to ensure that you stay in profit even if the tide turns.

StockGrow, a Bangalore based startup, was established in January 2020. With its focus on Millennials and Gen-Z, the company claims to grow almost 2x a month and has crossed 10 million app downloads within a year since its launch in June. 2020.