Investment Reflections from Lord Ganesha

Ganesha is here! The 10-day festival is a time for joy, celebration, and get-togethers. Festival celebrations take place in people’s homes as well as on grand scales in societies and public pandals. ‘Ganpati Bappa Morya!’ slogans and the sweet offerings of ‘Modaks’ add cheer to the festive and auspicious atmosphere. Lord Ganesha holds a special place in the Hindu tradition. He is known as ‘Vignaharta’ or the remover obstacles, Ganpati Bappa is often prayed to before starting anything new.
There are many stories and symbols around lord Ganesha’s form. His elephant head symbolizes intelligence while his big ears stand for listening with intent, his body represents strength and power while his vehicle, the mouse, represents humility. If we look at the Ganpati idol, we often see that the left tusk is broken. According to mythology, Ved Vyasa, the maharishi who wrote Mahabharat, wanted someone to write the story as it flowed from his mind. No one on earth was able to write at such a high speed. Hence, he asked lord Ganesha for help. Lord Ganesha, who was secretly delighted, agreed to help. Ganesha started writing using an ordinary quill. However, the quill broke off in the middle of the dictation. Not wanting to stop, Ganesha, simply broke off his tusk and continued writing. His dedication and commitment brought to life an important epic in Hindu tradition.

This story teaches us the power of consistency and dedication, undeterred by obstacles. Very often in investing and in life, we start something with great enthusiasm and stop it when we hit the first obstacle. Every 1st of January, we take gym membership and soon life takes over and we get so busy that fitness takes a back seat. Similarly with our investments, we start our investment journey with financial goals but as soon as the markets turn volatile or fall, we stop our SIPs and may even redeem our investments pre-maturely. Stopping SIPs prematurely comes at a cost. But imagine if we continued going to the gym despite the other commitments or if we continued with our investments despite the market fluctuations, what would be the outcome? Let’s look at some data to gain clarity.

Let’s see what happens if someone prematurely stops their investment at every market fall. Suppose Mr. Edgy started an SIP of Rs 2,000 per month on 1st September 2018. Assuming the investment was in the Nifty 50 TR Index. There was a major fall in equity markets in Mar 2020. Let’s see how Mr. Edgy’s investments look, had he redeemed at the fall and invested the corpus in fixed deposits versus had he stayed invested.

Data as on: 31st August 2023.
Source: NSE indices, SBI website and Internal Research.
*SBI fixed deposit rates for more than 3 years effective from 28/03/20 has been considered (5.7%) to calculate the final amount.

Had Mr Edgy continued with his SIP even after the volatility of 2020, he would now have a corpus of approximately Rs 1.76 lakhs. It is a small example indicating that consistently can play a huge role in your wealth creation story.
So, if we continued going to the gym despite the other commitments or if we continued with our investments despite the market fluctuations, what would be the outcome? A fitter and better us. Keeping this in mind, let’s do a Shree Ganesh of our investments!

Author is CEO Baroda BNP Paribas Mutual Fund. Views are personal