Eight Similarities between Cricket and Trading
Cricket is a passion in India and the audience treats cricketers as Gods. For those who are in the stock market whether by trading or investing, it is nothing less than a passion. It would be interesting to find similarities between the two passions of almost every Indian, The Cricket and Trading.
– In Cricket Toss is very crucial. The team decides it strategy beforehand what they will do after they win or lose the toss.
-Similarly in Trading, When you approach the trading in morning. You need to have a Plan B in place too. You do not know whether the market will act as per your understanding or not. Plan B will keep you in the game and help you win too in case something goes wrong.
There are three versions of international cricket:
-Test cricket (longer version)
-T-20 (Shorter version)
The stock market also has 3 versions:
· Long-term investment
· Medium-term investment
· Day trading
3. Level of Excitement
Just like the shorter version of cricket attracts more people & excitement because you get the result on the same day within hours & hence it is more profit-friendly for Sports Channels as advertisers pay more money per ad on these sports channels.
In comparison, Stock Markets is nothing different. Why people in India trade, not invest because they are much eager to know the result just like a T20 game or an IPL game. They want to know whether you earned or lost money in the trading format of the game. Because it is much more exciting to trade in day trading, business channels also involve themselves in giving what you call “FREE INTRADAY TIPS” and generate more profits from their advertisers.
· In cricket, it is a fight between teams from two counties & there is one winner.
· Similarly, In stock markets also, It is a fight between a bull and a bear. There are one winner and a loser.
5. Pitch Report
· In cricket, a bouncy track can create problems for the batting side & the batsman tends to behave defensively.
· In stock markets, the global scenario acts as a Pitch report. Weak Global conditions can prove problematic for an investor & investor plays defensively by investing in defensive sectors & other asset classes.
6. Team Selection
· Team selection holds the key in cricket and a balanced approach of playing 5 batsmen and 5 bowlers & one allrounder is necessary.
· In stock Markets, selecting the right stocks in your Portfolio is important to score runs or to make money & a balanced approach of selecting aggressive bets like banking, defensive bets like pharma & a allrounder like FMCG which acts as a defensive bet & also scores much needed runs in the final overs or during the bad economic times.
7. Real Test of the Game
· For true lovers of cricket, test cricket still remains the ultimate benchmark, where the real test of patience is seen in a player.
· Similarly for long-term investors, the real value of a company/stock is discovered only in the long run & it tests the real patience of an investor.
8. Time to opt for powerplay
· In cricket, the batting side take a decision strategically as to when to opt for a powerplay & have some quick runs on the board & therefore timing becomes important.
· In stock markets, the investor decides strategically as to when to enter the market from the bottom & score some runs or earn money as fast as possible.
“You cant win a game without playing similarly you cant create wealth without investing”
If you find more similarities between Cricket and Trading, Please comment below.