What motivates the public and what is real

What they say and what they mean

Time:- 10 Min

There was a sales distributor of Chocolates at  Etawah who had the dealership of both Cadbury and Dairy Milk. Cadbury offered him an incentive of 5 Rs on each pack sold while Dairy Milk offered only 1 Rs for each box sold. Moreover, Cadbury/Dairy Milk keep offering these incentives year by year i.e. 5 Rs per box for Cadbury and 1Rs per box for Dairy Milk.

Now, let's suppose this Etawah Dealer is you - What will you do? – Simply you will start selling Cadbury more as your profits are maximised in this case.

Now, there are few shopkeepers who demand Dairy Milk over Cadbury, however, you know that it’s not in the best interest of you – You start making false claims ‘ I can give you Dairy Milk though it’s not of the top standard, they use local chocolate though Cadbury uses the best of Chocolate’ & ‘Cadbury has the best packaging and you should just go for it’.

I am sure most of the shop owners will agree & later on the dealer will make a new argument that ‘90% of shopkeepers prefer Cadbury’ and the 10% will also start contemplating their decision pertaining buying the Dairy Milk'.

Now let’s come to stock Market

The dealer ---> Financial Advisor

Cadbury ---> Mutual Funds

Dairy Milk ---> ETF

Most of us trust our financial advisor when it comes to investing our money and they get a higher margins on Mutual Funds in comparison to ETF therefore most of the times they will just tell you about the Mutual fund and not about the ETF, however if you pursue them for the same they will tell you their old adage concept ‘In Mutual Fund there are lot of intelligent people who are looking after your money though ETF is just a mirror image of index’ – Which honestly is quite a jargon and the words which stay with you are ‘Intelligent people’ and  ‘Mirror Image’.

Who wants just a mirror image and who wouldn’t appreciate giving their money in the hands of intelligent people.

Thus, most of us are willing to invest in Mutual funds rather than ETF though ETF has the lowest charges and sometimes they also deliver exponential results.

We will talk about the ETF/Mutual Fund in detail though in this post I just want you to beware of the marketing of the various products and would like you to definitely ask your Financial Advisors for the ETF next time when they may tell you that who ever has advised you – Just don’t know much about the Financial business…

But then ..This is life and this is how it goes.👍