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I broadly agree with the thrust of the article. When the investment declines it is a decision point. The investor has to take a rational and considered decision based on his assessment of the future direction of the underlying market. This is very difficult for retail investors. He should seek help from a professional. A rational decision would be to limit loss to a predetermined % of either average cost or his risk tolerance level and moving the laggard into an investment which is expected to do better in the future. A disciplined approach is to re-balance at periodical intervals. If the market is in an downward spiral SIP is same as averaging down. The bottom line is value of investment not units.
Does this mean that SIP investing is a wrong concept? After all, SIP investings primary feature apart from saving small amounts is the Rupee Cost Averaging.
All articles of mastermind are really good .The real question is How many Clients are ready to Invest their Time and LISTEN to what we have to say.This is very difficult for those advisors who have joined since 2006 onwards.It has become Very Difficult to SELL Mutual Funds "HONESTLY". AMCS and SEBI must come together and kick start an Education cum Promotional campaign with the Retail Investor in mind. AMCs must unanimously pay commision on Trail Only basis.