Achieving financial success at a young age takes real courage and Prathap David Sandai has proved his mettle as a young fund manager. In order to achieve financial independence, he dived into the business world at 12 and now at 20, he is financially independent.
Moreover, Prathap David Sandai has also established himself as an entrepreneur. After having a long experience in the financial world, he has shared his view on the subject of investing vs trading. The youngest fund manager thinks that investing is better than trading.
Prathap David Sandai explains that investing involves keeping in mind the long-term state of a company. Whereas, trading simply involves focusing on the short-term ups and downs of the market. The motive of both the investment options is to make a profit by putting money in the right place.
Prathap David Sandai has expressed that trading involves earning quick cash but it also leads to quick losses. Whereas investing involves small-term gains but it also leads to fewer losses. According to him, investing is a better option than trading for every investor who wants to attain financial strength.
The young fund manager says that investing should be opted by anyone who wants to reduce risk and volatility in the investment world. Prathap David Sandai has highlighted that it is important for every investor to focus on long-term investing to achieve his financial goals. He says even research papers has proved that investing and dollar cost averaging into the stock market historically has given much higher gains than day trading. You will have a better chance at making money by doing nothing than day trading!
Prathap David Sandai also stresses the need to focus on only the best investments in the financial world. In his view, slow and steady investment into these assets over the long run is better than trading or diversifying into many companies.
His key message was find your highest conviction companies, focus on the fundamentals and buy the stock religiously, if the fundamentals of the business are strong, success and growth is inevitable. Additionally he stressed the importance of understanding businesses when investing. Lets be honest, as retail investors we can’t possibly fully understand and keep up with all the businesses we diversify into 10-20 companies or more! Therefore only invest in a few companies and understand their business well, even Warren Buffet has said, diversification is not going to make you very rich, he himself only owns 2-3 of his favorite stocks and that is enough for a lifetime of wealth.