Power Play and Investment, how does this sound together?
IPL fever is making its way everywhere and all the T20 lovers are glued to their television boxes. So, I thought why not try and bring my two favorite things cricket and investment together and start a new style of writing which will make things easier for the readers to understand. So, it has always been the whole 40 over a game that is fun and thrilling, but the most eventful game decider becomes the part when comes ‘ Power Play ’
For those who don’t know what is Power Play, it is a rule in T20 cricket which imposes fielding restriction i.e there will be only 2 fielders outside the 30-yard circle for the first 1st six over’s of each inning.
So, here every team grabs the opportunity and tries to take enough risk in this period to score maximum runs. If we try to see this parallel to our financial life, we also have a phase called ‘ Power Play ’ in it. That is the initial 10-15 years of working life. Where there are fewer responsibilities. This is the time where one should have maximum exposure in his investment portfolio towards equity.
Once the fielders spread out after the first 6 overs, batsmen doesn’t risk the chances too much and just keeps the ball ticking for 1’s and 2’s. Similarly when responsibilities come on the shoulder after the age of 35 one should not take too much risk in his investment portfolio and should have a disciplined 1’s and 2’s in the form of SIP.
Over the period of time ‘ Power play ’ has become a deciding factor. If a team scores above 60 runs in the initial 6 over’s of Power Play then there is a very high probability that the team will end up scoring above 180 runs. This becomes possible only because the team has laid a strong foundation in the beginning and the rest of the innings can be played intellectually. Even this strategy can be co-related to our investment decisions. By laying a strong foundation of equities in the initial 10-15 years, we are making sure that there is enough time given to these equities to grow in coming 20-25 years so that one can have enough corpus generated to have a risk free retired life.
That is why I say, “Power play is important” 😉
Do leave your comments below if you are a Cricket fan too!
For everything else, Money Anna is always around!