Retail investors

Having seen different categories of institutional investors, lets shift focus to retail investors now.

Retail investors are guys like you and me. We buy and sell securities in much smaller quantities than the institutional guys. Our pockets restrict us..

While we are pretty helpless individually in influencing markets; We are a significant force together. Typically, institutional investors are much more sophisticated when it comes to investing. They research more, have access to more information, have access to high-quality analysts and probably are better placed to feel the pulse of the market.

Given these structural disadvantages, retail investors are the guys who typically lose out when it comes to timing the market. We buy high and sell low. To avoid this, we are better off catching the trend rather than trying to time our entry/ exit into the market. Buy, if you think a stock will go up in the long term and sell if you think a stock will go down in the long term.