J Curve for Investing(4 min read)

It’s a Sunday morning, I was checking my facebook feeds after a long time. (I usually don’t check my Facebook account on a daily basis.) My phone rang, it was my brother from Mumbai.

“Hi, how are you doing?” – I asked

“Fine” – He replied. Then we talked about various topics for about ten minutes. I found his voice is dejected. I asked him if everything is ok or not.

After a deep sigh he said, he has lost his job as the company is not earning and downsizing. He is nearing forty and was earning handsome salary. This is a big shock to me and everyone in the family.

This scenario is now common, jobs are no more secure as they used to be earlier. You can’t count on your job and take big risk nowadays. This is where emergency funds come into the picture. It’s a life-saving jacket at this juncture. I told him that don’t worry, everything will be ok soon. It’s called a mid-life crisis and is bound to happen in everyone’s life. I know about the mid-life crisis because I have seen my colleagues have gone through it in their earlier age. That time I have to google it and came to know that it’s scientifically proven.

midlife crisis can happen when men think they’ve reached life’s halfway stage and feel the time is running out. The midlife crisis hits men at the age of around 40 and it lasts for three to ten years.

I think it’s a normal phenomenon if at all it occurs in one’s life.

Look at the chart below. It’s called the J-Curve, and it’s how a lot of things move in our lives and work.

If you check some of the great successful people in the world, you will find that they are not born rich. They have gone through this curve in their life. There is no overnight success. It’s only they have become better with time. We all now know Amazon so well, but it has been in making since 1994.

So don’t feel bad, what you are going through is what is called a mid-life crisis, and which is a very normal way of thinking at this stage of life.

This actually starts at the age of 18 when we are feeling pretty good about life and things around us. But when we venture out into the real world, we come to know what life actually is and our level of happiness drops. I think each one of us started our career with a high energy and hope. But after few years we discover it tough not only in career but also in life. and our level of happiness drops.

But there is no need to worry as this phase does not last long. As the curve suggests, it then rises again. Most of us grow steadily happier as we get older. So if you are at the bottom of the curve, don’t worry you will rise again. Let me tell you another view on it. You are blessed with many good things in life – like a good food to eat, healthy and loving family, your own house. write down 10 good things you have that make you happy. Then why one should feel dejected if he/she loses a job?

J Curve for Investing

The above theory not only applies to life but also to our investment portfolio. It has been proven that if you have invested your money in the good company for a longer time, you will reap a good profit in the end. There could be a time when your investment entered into mid-life crisis stage, but it is bound to rise again. In short, the J curve theory also works in investing your money. Good business has the capacity to sustain in bad phase as they have some provisions for that, same as our emergency funds.

So whatever is the situation right now, it will surely be going to improve in coming days. Patience and perseverance always pay.

It took me 17 years and 114 days to become an overnight success – Lionel Messi


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