Changing governments do not necessarily mark an end to reforms and equities are your best bet, but only over the long term. The message was clear at the 4th Investor Empowerment Programme (IEP) organised by Personalfn.

Mr. Mahesh Vyas (CEO and MD, CMIE) set the tone with his take on changing governments and the reform process. With some insightful incidents he elaborated that governments are temporary but reforms are permanent. In the past we had the United Front government supported by the Left, which was an 'ominous' sign for the reform process, only to see reforms continue unabated. In Calcutta, home to the Left, IT-enabled services did not go on strike, unlike the whole of West Bengal, to protest the Supreme Court's judgment that barred government workers from striking!

Mr. Vyas asserted that we need to define reforms first before embarking on an unbridled reform spree. In the last 10 years, 5 years have been very poor for agriculture. This kind of volatility impacts such a large section of the Indian population that it deserved a lot more attention. Instead, constant pandering to the elitist industrialist, left the farmer feeling short-changed. The recent vote was his snub to 'India Shining', 'feel good' and other urban balderdash. The message was clear - reforms must reach out to all sections and not just one section of the populace.

Mr. Prashant Jain (Head-Equities, HDFC Mutual Fund) also had an important message for the retail investor. He paraphrased Warren Buffet - stock markets are like a voting machine in the short-term and a weighing scale in the long-term, to highlight the importance of long-term investing. Equities are the investor's best bet only over the long-term. Unfortunately, 9 out of 10 investors do not look beyond a week or a month. So it's not surprising why most investors have a sorry tale to narrate about their equity investments. Another peculiar and perilous habit most investors have is to buy equities at peaks (high) and sell them at troughs (lows).

Mr. Jain drew parallels between real estate and gold investors on the one hand and equity investors on the other. The former buy real estate/gold when prices are low because they look at these investments from a long-term perspective (at least 10 years). Opposite is the case with the equity investor who tends to buy high because lower equity prices scare him! Mr. Jain explained that lower stock prices must actually be interpreted as an invitation to invest because the perceived risk at those levels is often lower than the inherent risk.

• Mr. Ajit Dayal (Director Quantum Advisors) got his message out loud and clear - unlike 2003, year 2004 is not going to be a party for emerging markets like India. Brazil, China and India are already off their highs in a big way. While elections are cited as a reason for the catastrophe hitting the Indian markets, Mr. Dayal clarified that the decline was in any case waiting to happen with foreign institutional investors (FIIs) and hedge funds (the biggest buyers in 2003) having made their money in India and looking West to catch the next best opportunity (read higher bond yields in US debt markets). FII investments in India were already on the decline and when FIIs are selling retail investors should help them by buying. As Sir John Templeton says, 'Always help people. When they want to sell, help them by buying; when they want to buy, help them by selling.' At the end, Mr. Dayal cautioned investors to look at the big picture 2-3 years, and not 2-3 months, down the line.

• The IEP was another step by PersonalFN.com and Equitymaster.com to educate investors about their investments and financial decision-making. We have every desire to make this a regular and timely feature. At the end we remain - the investor's best friend.

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