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What Cricket World Cup Taught Investors?


Don’t you love how World Cup brings nations together that is so different from each other? Cricket is a sport that is globally appreciated and large fraction of people from all over the world watches. Any sport for that matter teaches us a lot of things; be it team work, sportsman spirit, hard work, consistency, life lessons and even investing in right funds and companies. Understanding funds and investments can be a little tricky at times for the beginners and even for the ones who are masters in investing. If you are a fan of cricket, then this world cup 2019 must have taught you some amazing and yet disappointing things about investing.

Don’t fall in the trap of looking at past performances while choosing which funds to invest in. Having said that, it doesn’t mean past performances does not help you get the idea but this is not a primary and the only source of knowledge that you should gather in order to expect what sort of returns to receive in future.

The past performances and the history of a certain cricket team can sometimes give you an indication of the quality of that team and helps you understand more as to which funds and companies to invest in. In order to get a better idea of funds and where you can invest, look for the funds with a long term track record. Let say; keeping a track record of previous five matches taking weather conditions, pitch, consistency, performance of the team into consideration. Investment is not limited to only five days. The longer the timeframe, the better it is to keep a track of your teams’ records.

We have seen some great performances and many great teams have given their best since the start of the world cup. If you play good, you win. But, if some other team played better, you will lose. However, the concept of winners and losers is extremely poles apart when it comes to funds and investing.

How cool does that sound, right!

Yes.

It is as easy as it sounds. But, if not taken into consideration seriously and carefully; it can turn into some really complex equation which will be hard to decode.

If the team you have invested in played well, then your investment flourishes. But, if the other team does better, you still do not have anything to lose. You will not get benefits only if the team wins. You get benefits from investment’s performance.

But, choosing a fund or a company can be a task that needs to be played well. Be clear with your objectives, risk profiles, time horizon because that acts as a major point when it comes to investing in a right team.

For example; the English team started the tournament as a team to beat but a few matches down the line; the performance was unpredictable when least expected. At that time, everybody was in a dilemma and it became even harder to predict as to how England will perform and what will they do on a given day. England first lost to Australia and Sri Lanka and everybody almost lost hopes of it coming again on the top charts after a huge downfall, but England somehow managed to again go to the top of the charts and win the world cup.

England won the world cup for the first time and that too on their home ground. Both the teams who were playing the finals would have won the world cup for the first time. It was never going to be easy, was it? Striding through the wicket at three down at 71, it certainly wasn’t easy for sure. But, England’s brilliant all-rounder Ben Stokes is known for his determination and resistance, both with bat and ball. But, this wasn’t the occasion for that. This was the time for coolness from England’s hottest head. Singles became doubles, doubles became boundaries. This was his time. This has been his tournament.

england-series-graph

In that case, if the cricket team of England was a stock, the price would have dropped down at a high speed after they lost against Australia and Sri Lanka. But, after its victory it climbed all the way to the top. Right in the same way, if investors had made the mistake of predicting what the market would do, or how a particular stock would do, it could all have been gone wrong immensely.

These little details are what should be taken into consideration and needs to ponder upon because just a tiny bit mistakes in the calculations can result into some tremendous loss of funds. A lot of investors do not think too much about these little details and they really tend to make a whole lot of difference in the prediction. Many investors has ignored small changes in the business model or the economic scenarios, where smaller competition has come in to create some issues for the larger companies.

Next time when you plan to do funds and investments in some sport like this; do make sure to keep these things in mind for the better understanding of the craft and you can totally get a proper hang of it real soon. Investments and funds can be a little tricky but they are not something that is impossible to master upon. As they say; there will be some failures in the beginning but slowly and steadily; you will get there.

Happy investing!

By Garima