Majestic Investing Mindset: Factors investors can NOT control

 By Gaurav Kumkar, CEO of Majestic Investment Group

Investing isn't just about picking stocks or sealing deals—it's a mindset game. After many years at the helm of Majestic Investment Group, navigating everything from market highs to gut-wrenching lows, I've come to see it as a delicate dance between action and acceptance. You pour your energy into the elements you can shape, while building a resilient spirit to weather the storms you can't predict or prevent. This mindset isn't about blind optimism; it's about strategic wisdom, emotional discipline, and the humility to recognize your limits.

Think of it like captaining a ship on open seas. You can chart your course, trim the sails, and rally your crew—that's the controllable part. But the winds, waves, and sudden squalls? Those are the uncontrollable forces that test your preparation. In this piece, we'll explore both sides, weaving in the psychological traps that can derail even the best-laid plans. My goal? To help you foster an investing mindset that's grounded, proactive, and unbreakable.

The Uncontrollable Forces: The Market's Wild Cards

These are the big-picture elements that no investor or operator can bend to their will. They ripple through every portfolio, influencing timelines, returns, and even when you might choose to sell. The key mindset shift? Don't fight them—anticipate them, insulate against them, and turn them into opportunities when possible.

• INTEREST RATES the invisible hand that dictates the cost of borrowing and the appeal of safe havens. A sudden hike can squeeze leveraged deals, delay projects, or cool off hot markets overnight. We've watched cycles where rates climb relentlessly, forcing operators to rethink timelines and pushing returns into the red.
• INFLATION, for instance—it's like a slow leak in your wealth balloon, quietly eroding purchasing power over time. We've seen spikes that turn solid gains into illusions of progress. Closely tied to this is money printing, where central banks flood the system with liquidity, often sparking asset bubbles or devaluing currencies in ways that reshape entire economies. Insurance inflation hits hard too, especially in real estate or asset-heavy investments. Premiums skyrocket due to broader claims trends or regulatory shifts, eating into margins without warning. It's a reminder that protection comes at a price—one that's often dictated by external events like climate patterns or industry-wide losses.
• PRICE SWINGS Commodity such as oil and gas prices, gold, silver, bitcoin, crypto currencies, can upend sectors overnight. A geopolitical flare-up or supply disruption sends energy costs soaring, inflating operational expenses and compressing profits. These aren't just numbers on a chart; they alter the feasibility of investments, from manufacturing timelines to transportation logistics.
• RECESSIONS roll in like economic winters, contracting growth and shaking consumer confidence. They arrive uninvited, often triggered by a mix of these other forces, and can stretch out for months or years, testing your liquidity and resolve.
• CRASHES amplify the chaos, turning rational markets into fear-driven frenzies. We've endured plunges that wipe out trillions in value in mere weeks, driven by panic rather than fundamentals.
• TARRIF WARS and geopolitical tensions add another layer, disrupting supply chains and imposing unexpected costs. Trade barriers can delay shipments, hike import fees, or even render certain markets unviable, all while you're powerless to negotiate the terms.
• NATURAL DISASTERS —floods, earthquakes, fires—that strike without mercy, damaging assets and halting operations. These acts of nature remind us that no due diligence can foresee every risk.
• PROPERTY TAXES rises creep in through local policies, reassessing values and demanding more from your cash flow. They're often tied to municipal needs or economic pressures far beyond your control.

The mindset here? Acceptance breeds strength. At Majestic, we don't waste energy railing against these forces. Instead, we build buffers: diversified holdings, ample liquidity, and flexible strategies that allow us to pivot. It's about preparing for the worst while hoping for the best— a calm acknowledgment that these elements will affect every investment's journey, from inception to exit.

The Controllable Elements: Where Your Power Lies

This is where the real magic happens—the factors you can actively influence through effort, insight, and discipline. Cultivating a mindset focused here turns investing from a gamble into a craft.

• Start with due diligence, your frontline defense. It's about digging deep into the details: scrutinizing financials, evaluating teams, and mapping out competitive landscapes. We've turned potential pitfalls into triumphs by spotting red flags early, like over-reliance on a single client or shaky revenue streams.
• Hard work is the engine. It's the late nights refining models, the persistent networking that uncovers hidden gems, and the relentless execution that compounds small edges into big wins. Our team thrives on this grind, knowing it separates those who dream from those who deliver.
• Strategic thinking elevates it all. It's playing the long game—anticipating shifts, war-gaming scenarios, and positioning for upside. We've acquired undervalued assets during distress periods by thinking several moves ahead, turning market noise into strategic silence.
• Risk vs Reward - risk is a personal matter, depending on various factors viz. Age | Health | Income Stability | Family responsibilities | Net worth & Liquidity | Experience | Time Horizon | Sleep Factor 
• Harness tax benefits wisely; they're like free boosts from the system. Through smart structures like exchanges or incentives, we've preserved capital that keeps working for our clients, deferring liabilities and accelerating growth.
• Passive income streams are your safety net, generating steady flows from rentals, dividends, or royalties. We've built portfolios that hum along, providing cash even when active deals pause, fostering a mindset of abundance over scarcity.
• Capital growth rewards patience. It's about nurturing investments over time, buying wisely and holding through volatility. Our approach focuses on intrinsic value, letting compounding do its quiet work.
• Diversification isn't just spreading bets—it's thoughtfully balancing across assets, regions, and risks to create harmony in your holdings.
• Economies of scale As you grow, costs shrink and doors open. We've leveraged our size for better terms, exclusive opportunities, and efficiencies that individual investors rarely touch.

The investing mindset thrives here: ownership and agency. Every day, you choose to invest in these areas, building a foundation that's resilient by design.

Behavioral Biases: The Inner Saboteurs

Even with the best strategies, your mind can be the biggest hurdle. These biases sneak in, distorting decisions and amplifying risks. A strong investing mindset means spotting them early and countering with discipline.

• Loss aversion makes losses sting twice as much as gains feel good, leading to premature sells or stubborn holds. We combat it with predefined rules, detaching emotion from action.
• Recency bias tricks you into chasing the latest trend, ignoring history's lessons. Our fix? Long-view data and deliberate contrarian thinking.
• Overconfidence whispers that you're smarter than the market—until you're not. Humility checks, like external reviews, keep us grounded.
• Herding pulls you into the crowd, buying high and selling low. We cultivate independence, celebrating "unpopular but right" moves.
• Anchoring fixates on past prices, clouding current realities. Regular resets to forward-looking metrics break the chain.
• Confirmation bias seeks only affirming evidence. We flip it with "what if I'm wrong?" exercises, ensuring balanced views.

Mastering these isn't about perfection—it's about awareness and systems that nudge you toward rationality.

Case Study: Stock Market crash

It’s September 29, 2000. The dot-com bubble is bursting like a fireworks finale gone wrong. Apple—yes, the same Apple we worship today—drops 52% in a single day. From $2.20 (split-adjusted) to barely a dollar. By late 2002, it’s down 82% from its peak. Forums are screaming “Apple is dead.” Analysts are writing eulogies. People are selling their shares in tears, convinced the iMac was just a colorful fad.

Fast-forward to 2008. The world is melting. Lehman collapses. Apple, now led by the “boring operations genius” Tim Cook and the returning messiah Steve Jobs, falls 61% in 14 months. The iPhone is barely a year old. People panic-sell again, cursing the company that would soon redefine humanity’s relationship with technology.

 It didn’t matter that Steve Jobs was a once-in-a-century visionary, or Tim Cook was best operating officer or Jony Ive was designing the future in his secret lab or 166,000 brilliant minds were grinding 80-hour weeks.

Apple crashed anyway. Twice. Hard. Because interest rates, money printing, market crash sentiment, commodity prices dips and spikes, tariff fears, and global panic are forces no CEO—no matter how legendary—can outlaw. These are the uncontrollable storms that hammer every asset class the same way.

Cultivating the Ultimate Investing Mindset

At Majestic Investment Group, our philosophy boils down to this: Control what you can, prepare for what you can't, and guard against your own mind's tricks. This mindset has guided us through turbulent times, delivering consistent value to clients who share our vision.

 As the world legendary investor Warren Buffett and Charlie Munger say “If you cannot control your emotions, then you cannot control your money.” and “The most important quality for an investor is temperament and not intellect.”  and "investing is NOT an IQ (intelligent quotient test) its rather an EQ (emotional quotient test).

Remember, all investing involves risks, and past performance isn't indicative of future results—always consult a professional and do your own research. At Majestic we do NOT provide legal, tax, investment, retirement advise. Projections are not guarantees nor promises in any investments and everything depends on market factors.

Thank you.