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By:

C.S. Krishnamurthy

21 June 2025 at 2:15:51 pm

Risk Refines Returns

An anxious investor entered his adviser’s office, clutching a file of stock charts. He was convinced he had found the perfect moment to enter the market. His plan was to wait for the precise dip, jump in, make quick gains and exit smartly. The adviser smiled gently, the way a teacher smiles at a student who thinks the syllabus ends with the first chapter, and began narrating a small tale that has stayed with me for long. He spoke of two farmers. One sowed seeds as the monsoon clouds gathered,...

Risk Refines Returns

An anxious investor entered his adviser’s office, clutching a file of stock charts. He was convinced he had found the perfect moment to enter the market. His plan was to wait for the precise dip, jump in, make quick gains and exit smartly. The adviser smiled gently, the way a teacher smiles at a student who thinks the syllabus ends with the first chapter, and began narrating a small tale that has stayed with me for long. He spoke of two farmers. One sowed seeds as the monsoon clouds gathered, tended the soil, and trusted sun, rain, and time. The other waited on a hilltop for the perfect cloud, believing precision mattered more than action. He kept climbing, analysing patterns. When the rains finally came, the first had green shoots breaking the earth. The second had only reasons. The adviser paused and said markets behave similarly: prepare early, stay invested, and let time do the real work. This simple story captures a truth that investors often forget. Most people desire higher returns, but very few want the risk that accompanies those returns. In wealth management, the principle remains constant across decades: high return requires high risk, low risk brings low return. What separates successful investors from frustrated ones is not luck or timing, but the ability to align risk, return and time horizon with the purpose of money. Risk Realities Consider a parent whose child’s college fees are due next year. A rising equity market may look attractive, but it is the wrong choice for such near-term needs. Even a small correction can upset careful plans. Here, safety matters more than growth because the goal is fixed and non-negotiable. Now contrast this with a young professional in her twenties avoiding equity due to fear of volatility. Ironically, she takes the bigger risk. By shunning growth assets, she risks losing future purchasing power. For her, time is a powerful ally that cushions volatility and rewards patience. Wealth planning begins with understanding three elements. The first is risk capacity. This is the financial ability to take risk. It depends on income, savings, liabilities and, most importantly, time horizon. A thirty-year window offers room for market ups and downs. A one-year window does not. When capacity is misunderstood, investors either become too aggressive or unduly conservative. The second is risk attitude. This has nothing to do with spreadsheets, and everything to do with psychology. Some investors can see their portfolio fall twenty pc and continue sleeping peacefully. Others panic if their units fall two pc. Knowing one’s emotional bandwidth is vital. A perfect portfolio is useless if the investor abandons it during the first storm. Behavioural finance teaches us that panic selling, not market decline, destroyed long-term wealth. Balancing fear and greed matter. The third is investment need. This is often ignored because investors chase returns without asking what return is actually required to achieve their goals. If a goal needs nine pc annual growth, why chase fourteen pc with twice the risk. When all three elements align, portfolios stop being products and begin to act as strategic tools that move families closer to their life outcomes. Purpose Planning Remember, risk is not a bad word, nor an enemy to fear, but a knife to be handled wisely. In skilled hands, it slices food, and in a surgeon’s care, heals bodies with precision. In careless use, it wounds deeply. When aligned with goals and time, risk builds wealth. Long-term investing lies in respecting its sharp edge and using it with patience and discipline. In the end, the adviser reminded the anxious investor that the greatest financial risk is not volatility, but a portfolio that does not match its purpose. Timing the market might offer a few lucky victories, but time in the market builds lasting wealth. Seeds grow not because the farmer predicts rain, but because he plants them early and let nature work. That lesson holds for every investor. Goal setting, disciplined risk alignment and the patience to let compounding work turn uncertainties into opportunities. Wealth is not created by chasing returns, but by respecting time.  If you are ready to follow discipline in investment, risk can turn into opportunity. (The writer is a retired banker and author of ‘Money Does Matter.’ Views personal.)

Restoring Values in Science: Honouring Dr. Kalam’s Vision for Tomorrow

A.P.J. Abdul Kalam’s values matter more than ever in today’s age of innovation.


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On July 27, we remember Dr. A.P.J. Abdul Kalam, not only as India’s ‘Missile Man’ or a former President, but as a scientist who combined knowledge with kindness, ambition with humility, and vision with values. He believed that science should not only fuel growth and power, but also serve humanity, especially the poorest and most vulnerable. “Science is a life-giving tool if used with values,” he said. As we mark his death anniversary, the best tribute is to ask: Are we building the kind of science he dreamed of?

 

Today, science and technology drive national pride and economic growth. From space missions to clean energy and artificial intelligence, we see rapid innovation. However, as success grows, so does the pressure to publish more, patent more, raise funds, and launch new ventures. In this rush, we may lose sight of what matters most. Dr. Kalam always asked: What is the true purpose of science? Is it about creating wealth or improving lives? About solving problems or building a better world? His answer was clear: science must do both, but only when guided by what is right. Righteousness, for Kalam, was not just a personal value; it was the foundation for a peaceful nation and a just world. He once said: “Where there is righteousness in the heart, there is beauty in the character. When there is beauty in the character, there is harmony in the home. When there is harmony in the home, there is order in the nation. When there is order in the nation, there is peace in the world.” This was his formula for national transformation, starting from within.

 

Around the world today, people are asking what we truly value. Mark Carney, now the Prime Minister of Canada and a renowned economist, writes in his book Value(s) that what we measure and assign value to is not always what we care about most, such as trust, fairness, or community. His analysis is timely. What Carney explains through economics and policy, Kalam embodied through science and service. Both deliver powerful messages: progress must be guided by values.

 

Today, science often operates like a marketplace. Researchers are judged by the number of publications they produce. Institutions are ranked based on citation counts. Funding tends to favour ideas that are quick, profitable or currently popular worldwide. While these systems improve efficiency, they also exclude essential work, especially research that requires time, addresses rural needs, or offers no immediate results.

 

As a result, important areas are overlooked. Efforts in village sanitation, small-farmer tools, or affordable healthcare often receive minimal support, even though they significantly impact lives. For example, locally developed portable water purifiers and soil microbial technologies for dryland farming have shown potential but lack steady funding. Judging science solely by market value ignores compassion, fairness, and the public good.

 

Less than 10 percent of India’s science funding reaches grassroots projects, even though 60 percent of the population lives in those areas. This shows what we prioritize and who we choose to serve. Kalam believed that true scientific excellence must be inclusive.

He was not against commercialization. He supported transforming research from labs into practical applications, from missiles to medical implants and solar energy for rural communities. However, he emphasized that the ultimate goal must be national growth and dignity. “Science is a tool of service,” he said, “not supremacy.” True progress requires humility, courage, and purpose.

 

He also shared a simple equation: Knowledge = Creativity + Righteousness + Courage

 

This idea reminds us that knowledge needs imagination, ethical principles, and the courage to do what is right. Young scientists can learn much from Kalam’s life. He rose from a humble background, overcame setbacks and turned each achievement into public service. He inspired students not only to dream but also to act with purpose. He believed that success should not be measured solely by papers or patents. Teamwork, mentorship, integrity and long-term societal benefits are equally important.

 

He urged institutions to focus on long-term value, originality, and national needs over global rankings and trends. To industry, his message was clear: science must serve stakeholders, not just shareholders. Innovation rooted in service like clean energy or eco-packaging was, for Kalam, the path to lasting leadership.

 

India aims for global scientific leadership. But that leadership must come from within, rooted in our values, environment and people. We need a unique scientific language, one that combines Gandhi’s moral clarity, Raman’s curiosity, Bhabha’s institutional vision, and Kalam’s deep compassion.

 

This will require bold reforms. Science funding must expand beyond elite institutions. Education must include ethics and courage along with technical knowledge.

 

Kalam’s vision of PURA (Providing Urban Amenities in Rural Areas) was ahead of its time. Though it began slowly, its core ideas remain vital. In today’s digital age, rural broadband, mobile diagnostics, climate-smart farming and water technologies must be integral to India’s scientific goals. From climate change to public health to artificial intelligence, our future depends not just on innovation but on trust, ethics, and cooperation. As Kalam said, science must be “the conscience of civilization.”

 

In remembering him, let us pledge not only to pursue science but to do it ethically. Let laboratories become places of service. Let each discovery embody a greater responsibility. Let every innovation uphold our shared humanity.

 

And let us not forget Kalam’s timeless message, which deserves a place in every institution: “Righteousness in the heart leads to beauty in the character, harmony in the home, order in the nation, and peace in the world.”

That is the science the world needs. That is the science India must lead.

 

(The author is the former Director, Agharkar Research Institute, Pune and Visiting Professor, IIT Bombay. Views personal)

 

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