The IPL frenzy is set to start. If you are a fan of this shortest yet immensely popular form of cricket, then you can also draw various financial lessons from Indian Premier League (IPL).
What’s The Game Plan Of IPL Teams?
With just 20 overs for each team to make a splash, IPL redefines the gentleman’s game by taking more risks rather than preserving the wicket or being defensive. Usually, this risk is taken right in the beginning of the match, when there are batsmen to spare, and at the nail-biting end when there’s no option other than to swing for the boundary no matter the quality of delivery.
Go Aggressively At The Start
In IPL, field restrictions are applied for first six overs, which throws an opportunity for the player to score runs in the initial few overs. You can apply the same in your investment strategy by using the initial days of your monthly salary for investing. Set a significant amount for saving in the beginning of the month and work on a budget for the rest of the month. This will help you inculcate a habit of financial discipline and also put you on track of wealth creation.
Remain Focussed On Your Target
Take a cue from the strategy of IPL teams of scoring runs till the end to beat their opponents. Focus is the key here. Like IPL teams, have a goal in mind. Whether it’s a solo vacation, a wedding, or a down payment for a car, this goal will help you line up your team.
Play To The Situation
Like an IPL game, think of your plan of attack based on what you’re playing against. If it’s a goal that you cannot compromise on, your aim is to preserve your capital and earn via less risky fixed income securities. Look for Fixed Deposits or Recurring Deposits. If the goal allows you to increase your risk exposure, get market-linked results via equity mutual funds or money market funds.
Diversity Helps You Win
Scoring and winning a match is all about team work. An IPL team is a blend of strong players, who are good in different aspects of the gams. Take a cue from this strategy and create a diversified team (portfolio) with the best investment tools having the potential to enhance your wealth.
In an IPL match, no two overs are similar. A good bowler can keep the run rates low, while a weak bowler can allow the batsmen to break free. Investment in mutual funds are also like this. When the markets are down, you may feel returns are not high, but as soon as the market picks up, your returns are flying high. What finally leads to winning is your perfect investment strategy based on situational requirement.
Besides the above mentioned points, like IPL, have a positive approach and never lose hope, be it your investment. The outcome of a game can change in one over, so the players remain focussed but they do review their game strategy. Likewise, you should remain focussed, and invested in an instrument by reviewing it periodically to reap in benefits.
The writer is CEO, BankBazaar.com