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At times, investors ask whether they should buy stocks that have fallen sharply compared to the broader market—especially when such stocks look “cheap” and promise high upside. The temptation becomes even stronger when prices have corrected steeply. However, a sharp price fall combined with regulatory irregularities, governance lapses, or poor product quality is a very different situation from a normal market correction.

In investing, it is important to remember a simple but powerful idea: problems rarely come alone. When a company is flagged for regulatory issues or ethical lapses, what is visible is often just the first cockroach. Experience shows that there are frequently more issues hidden beneath the surface—weak internal controls, compromised culture, aggressive accounting, or management decisions driven by short-term survival rather than long-term value creation.

Many investors assume that once “bad news is out,” the worst is already priced in. Unfortunately, that is often not the case. Regulatory scrutiny can drag on for years, management credibility may erode, customers and partners may lose confidence, and growth can suffer permanently. Even if the company survives, its ability to compound wealth over time is often impaired.

This is why reputation matters far more than short-term valuations.

As Warren Buffett famously said:

“We can afford to lose money, even a lot of money. We can’t afford to lose reputation, even a shred of reputation.”

Money lost can sometimes be recovered. Lost trust rarely is. A company with a damaged reputation faces higher costs of capital, greater regulatory oversight, and long-lasting skepticism from investors. These are not temporary headwinds—they are structural disadvantages.

From an investment philosophy standpoint, we prefer to focus on businesses where integrity, transparency, and governance are beyond doubt. Even if such companies appear expensive at times, they offer a far better chance of sustainable wealth creation. On the other hand, companies surrounded by controversy may look optically cheap but often turn into value traps.

In the long run, successful investing is not about chasing the lowest price—it is about backing businesses you can trust through good times and bad. When credibility is compromised, patience and capital are usually better deployed elsewhere.

Bottom line:

When regulatory or ethical issues surface, assume there may be more beneath the surface. In investing, avoiding permanent damage is far more important than catching a “bargain.”

For your success!

Dr. Anil Kumar Asnani

SEBI Reg. Research Analyst

Whatsapp: 9755920780

Mobile: 9131361959

Website: https://www.smartverc.com

In the world of investing, what you focus on grows.

A portfolio doesn’t just reflect numbers — it often mirrors the mindset of the investor behind it.

If you constantly complain about market volatility, government policy, or short-term underperformance… you’ll likely find more reasons to complain.

If you stay angry about missed opportunities or falling prices… you’ll keep carrying that weight into future decisions.

But if you train yourself to look for long-term potential — if you stay calm, rational, and optimistic — you’ll begin to see more opportunities than problems.

Complaint and Anger Are Emotionally Expensive

Complaining leads to inaction.

Anger leads to hasty action.

Both are driven by emotions, and both are costly for investors. We’ve seen it time and again — investors selling during a correction out of frustration, or jumping from one stock to another looking for instant gratification.

Such moves rarely create wealth. They create fatigue.

Optimism Isn’t Naïve — It’s Strategic

A truly optimistic investor isn’t blindly hopeful.

They’re grounded, patient, and prepared.

They understand that market cycles are natural. That volatility is a feature, not a bug. That every sharp correction brings seeds of future growth — if one is willing to look beyond the noise.

At Smart VERC, we’ve built our philosophy on this kind of disciplined optimism.

Not hope. Not hype. But earned confidence in business fundamentals, valuation, and long-term trends.

The Mindset That Wins

Complaining begets more complaints.

Anger begets more anger.

But optimism — steady, informed, thoughtful optimism — begets wealth.

What you feed, grows.

Feed your optimism. Let it compound.

For your success!

Dr. Anil Kumar Asnani

SEBI Reg. Research Analyst

Whatsapp: 9755920780

Mobile: 9131361959

Website: https://www.smartverc.com

Issac Newton once said, “I can calculate the motion of heavenly bodies, but not the madness of men.”

This quote perfectly captures the nature of the stock market.

We can calculate the motion of planets with precision because they move in a fixed and predictable path. Even with changing weather or temperature, the trajectory of celestial bodies can still be forecasted years in advance.

But the stock market doesn’t move in a fixed path. It depends on countless factors—economic conditions, geopolitical events, currency fluctuations, interest rates, and even sudden shifts in investor sentiment. That’s why predicting the market in the short or even medium term is nearly impossible.

However, an investor can assess the growth potential of an individual company to a reasonable degree. A company’s future depends largely on its management—its ability to innovate, adapt during slowdowns, and take decisive action in times of uncertainty.

That’s why the smartest strategy is to focus on companies, not the market. When the market rises, nearly all stocks rise with it. But when the market falls, only those with strong management and sound fundamentals continue to stand out.

In the long run, it is great companies—not market predictions—that create lasting wealth.

For your success!

Dr. Anil Kumar Asnani

SEBI Reg. Research Analyst

Whatsapp: 9755920780

Mobile: 9131361959

Website: https://www.smartverc.com