Fear of Losing Out (FOLO)!

Fear of Losing Out (FOLO) is the apprehension of losing out on further gains from an investment, disregarding the importance of withdrawing funds at the right time. Let’s say you have invested in a fund with a clear 10-year goal. As you approach the goal, the temptation to prolong your investment arises, overlooking factors like risk, proximity to the goal and the unpredictable nature of the market. By chasing short-term returns, your accumulated corpus for a goal is subjected to increased risk. Another aspect of FOLO is when an investor becomes overly conservative, avoiding measured and informed risks. This tendency leads them to lock funds into low-yield, safe investments for extended periods, potentially missing out on higher returns that could have been achieved through more diversified investments over the long term.