Mahabharata Investing Lessons for Today's Stock Market Trader

Every one of us must be familiar with the great Indian epic Mahabharat. The great Hindu mythology which has been one of the highest rated television programs of a time. It was written by Ved Vyas and is a narration of the Kaurava lineage of ancient India. The highlight of this epic is the Great War which marked the end of the world’s third era – Dwapara Yug - which took place in Kurukshetra, a place in modern day Uttar Pradesh. Have you ever wondered that the Mahabharat actually taught us many lessons on how to be a successful investor?

Be it the game of dice which changed the course of history or the guidance of Krishna which helped Pandavas win the war where the odds were stacked against them, the Mahabharat has a lot of lessons to teach to a modern day investor. Let’s learn a few of them here.  

1. Have complete knowledge and do a proper research: During the Mahabharat war, the great warrior Arjun’s son Abhimanyu was in a situation where he had to break through a very difficult military formation known as the Chakravyuh. He had heard the tactic of breaking through this complex military formation when he was in his mother’s womb. However, his knowledge was incomplete since he did not know how to get out once he was inside the formation. As a result, he was killed inside the Chakravyuh, all due to the lack of proper knowledge.

Similarly in market trading it is very necessary to have a thorough research and knowledge of your investment before proceeding. Incorrect or incomplete information about your investment strategy can lead you in huge losses which can be beyond repair.

2. Stick to your goal: At the age when the Pandavas were undergoing their education and training in the ashram of the great teacher Guru Dronacharya, there was an instance when the teacher had asked all his pupils to shoot a bird sitting on a tree and then asked all his pupils about what can they see? Out of all the princes, only Arjun answered that he could see only the bird’s eye where he was supposed to shoot. When Guru Dronacharya asked him about his strategy, he said that he was focused only on the bird’s eye and could not see anything apart from it.

As an investor, you should have a goal and you should stick to it. There can be various lucrative offers in the market which can draw your attention, but it is recommended to strictly focus on your goal and not deviate from it.

3. Avoid overconfidence: At the time in Mahabharat when Pandavas had built their magnificent Palace in Indraprastha which was full of illusions, they were highly confident of themselves. Such was their overconfidence that when the eldest Kaurava Duryodhan fell in a pond which gave the illusion of a solid ground, the Queen and the Wife of Pandavas – Draupadi laughed at him and made fun of how a blind father’s son was also blind. This overconfidence and haughtiness cost her much highly later on, when Duryodhan ordered for Draupadi to be dragged in the court of Hastinapur to take revenge against her cruel words.

As an investor, you need to keep always keep in mind that there can be various risks hidden behind attractive returns. While investing in seemingly profitable places might seem lucrative (like Draupadi’s giving in to the urge to make fun of Duryodhan) it is necessary to analyze the risk and returns of any investments and its consequences before proceeding further else you will be left with nothing in the end.

4. Don’t be blind to obvious signs of impending losses: The father of the 100 Kauravas Dhritrashtra was blind since birth. However, he was not just blind by his eyesight, but was also blinded in his mind because of his love for his son Duryodhana whom he wanted to be made the king after him. His love and passion to see the day when his son would be made a King was so strong that he did not stop his son from scheming and plotting evil plans against the Pandavas including sending them to Lakshyagraha and inviting them for a game of dice which was rigged to the stripping of the Pandavas’ wife Draupadi in an open court. His ignorance and inactivity cost him dearly when all these small signs led to his huge loss in the war of Mahabharat where he lost all his 100 sons.

An investor must always be alert and on the look out for signs of downfall in a company’s functioning which would sooner than later translate into aa major thing and erode the wealth of investors. Sticking on with a stock for too long despite major signals that the stock is going to drop is called familiarity bias in behavior finance and should be avoided.

5. Choose a worthy advisor and guide: Pandavas would not have been able to win a war in which all the odds were stacked against them had they not taken guidance from Lord Krishna. Before the war began, Arjun had lost all his will to fight the battle looking at all of his cousins, teachers and family members pitted against him in Kurukshetra. However, Lord Krishna whom Arjun chose to be his guide and mentor advised him to perform his tasks without getting emotional.

Same can be true for trading- especially day trading. A person must not get too attached or emotional to the profits and losses and must have a practical approach in life. Also, taking help of a trustworthy and dependable investment advisor is also extremely crucial for traders to stay focused on their goal in face of losses.

These are some of the strategies from Mahabharat which can help you in becoming a successful investor, but one should always remember that with investment your capital is at risk. If you are new to the market or are not confident enough it is better to have a certified advisor to be your “Shri Krishna” and guide you with trading.