Where do you invest Mr. RBI Governor? Are you a ‘Guardian’?

The RBI Governor Mr. Shaktikanta Das has maintained status quo with policy rates. The reason being the sticky food inflation. He doesn’t want to take a chance. This frame of mind is typical of a ‘Guardian’ type of investor.

We appreciate your decision Mr. Governor. In fact, everyone should appreciate. As finance secretary of India, you contributed a lot to stabilize Indian Economy and as RBI Governor, you have been resilient enough to succumb to any rate cut pressure. Your decisions at monetary policy front makes us believe that you are a ‘Guardian’ type of investor for the practitioners of Behavioral Economics.

‘Guardian’ investors are both anxious and careful.  Although they are full of confidence but find it difficult to override the advice of counsellors. We can assume that Mr. Governor will be finding it easier to go with the advice of Monetary Policy Committee (MPC) while deciding on interest rate.

The ‘Guardian’ investors generally emphasize on safety of the capital while making the investments and a significant proportion of their investments is devoted to government securities, fixed deposits and less risky assets like debt mutual funds. This framework of mind is translating into robust and stable economy with reasonable growth rate. His prime objective would be to protect the economy from global turbulence and domestic challenges.

Mr. RBI Governor has announced his decision on Monetary Policy. Would he let us know his portfolio as well?

It’s noteworthy that the Five-Way Model developed by Bailard, Biehel and Kaiser (BB & K Model) classifies investors into five categories based on their confidence and preferred way of action. These have been named as Individualist, Adventurers, Celebrities, Guardians and Straight Arrows.