10 Simple Lessons to Survive Stock Market Crashes

1. Markets Are Not Always Right Stock prices reflect human emotions as much as facts.
Example: Zomato jumped after listing but later dropped almost 50%.
Lesson: Do your own research—don’t assume the market is always right.

2. Don’t Follow the Crowd Copying others often leads to buying high and selling low. Lesson: Invest for your own goals, not to match the crowd.

3. All Crashes Feel New, But They’re the Same Most crashes follow the same cycle: excitement → too much money → overconfidence → cracks → panic.
Lesson: Recognize the pattern and stay calm.

4. Buy Cheap, Not Expensive Great companies are not always great investments if the price is too high.
Lesson: Price matters. Overpaying hurts returns.

5. Be Patient Good companies need time to grow.
Example: Bajaj Finance fell 80% in 2008–09, but rewarded patient investors over the next 15 years.
Lesson: Hold for the long term.

6. Watch Market Mood When fear is high, prices can be low. That’s when opportunities often appear.
Lesson: Sometimes the best buys happen when most people are afraid.

7. Avoid Too Much Borrowing Leverage can magnify both gains and losses.
Lesson: Invest mostly with your own money to reduce risk.

8. Keep It Simple Complicated models often fail in crises.
Lesson: Clarity beats complexity.

9. Look at the Big Picture Even strong companies are affected by the economy.
Lesson: Track both company health and economic conditions.

10. Prepare Before Trouble Comes Risk management works best before a downturn, not after.
Lesson: Diversify and hold strong companies before storms hit.

Market crashes are part of investing. We can’t avoid them—but we can prepare for them. Montier’s lessons are a reminder that patience, discipline, and preparation matter more than prediction. Stay calm, stay invested, and you’ll not just survive the storm—you may come out stronger.

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