Book Review – Riding the Roller Coaster by Amit Trivedi

“If you earn average returns in the markets with fewer mistakes you will be better off than the investors generating higher returns while committing more mistakes.”

This is one of the simplest principles to create wealth in the long term. The key here is not to focus on the returns but to make fewer investment mistakes. However, looking back in history, we will realize that we commit numerous mistakes in our portfolios that drag our returns down and make unsurmountable losses. Most of the mistakes are made in the period of euphoria. The fear of missing out (FOMO) syndrome and overconfidence affects our decision-making and makes them irrational.

Amit Trivedi’s passion for investor education and awareness, added with his experience of more than two decades in the personal finance space ensures the readers get this well-researched and articulated book – Riding the Roller Coaster. In his book, Amit has analyzed some of the major episodes of booms and busts impacting the financial markets. He has carefully selected episodes spread across five centuries: ranging from the Tulipomania in the seventeenth century to the sub-prime crisis in the early twenty-first century. In his analysis, he has drawn parallels on how human behavior has remained constant across all episodes. Thereafter, he has prescribed a simple and easily implementable rational decision-making process to create and maintain a well-cushioned portfolio.

Why do such events happen in the first place? Is there a commonality amongst all these events? How human behavior tends to react in each situation? Is it the same always or different? Can these events be predicted? What can be done to protect our portfolios or build shock absorbers to minimize the shocks given by such events? If you have any such question running in your mind then this book may answer majority of your questions, if not all. 

There is a tendency amongst authors to dissect events of such magnitudes, impacting the global markets. They tend to bring the guilty beings in the forefront. However, Amit has clearly refrained from the blame game and provided valuable insights to the common investor who are generally take for a ride. He kept his focus on the human behaviors – how they react across the cycles of euphoria to denial and to despondency. Generous use of anecdotes coupled with his trademark witty style makes this a compelling read for any level of market participant. Amit has utilized these events for guiding readers who are in pursuit of creating a well-cushioned portfolio.

Whether you are entering the markets for the first time, or you have spent a reasonable time in the markets; whether you are a trainer or a wealth manager, or an advisor; this book can hold your attention for a longer span of time equally for all its readers alike. The language is lucid and flowing, the content is delivered in a simple and easy-to-understand format. In fact, you will be able to create your investment checklist which can act as a seat belt while riding this roller-coaster known as financial markets. In a nutshell, read this book to know in brief about the major events that impacted the financial markets, how you can negate the herd mentality in euphoric times by learning from the past mistakes, and what can be done to manage your money rationally. You will be able to collect enough one-liners which will help in creating your own checklist for managing and mitigating risks in your portfolio. Read it once to gain knowledge and read in periodically to become wiser every time.

Published by Vivek Damani

Vivek is a personal finance expert with 27 years plus experience in the field of personal finance. He is also a passionate long-distance runner and loves to have a balanced approach thereby leading a joyful life.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: