New Delhi, Jan. 13 -- Most investment failures happen because we chase success too late and too fast. The deepest irony of equity investing is that failure is often seeded in success. When success becomes overblown, it inevitably becomes the seed of future failure. The reasons are not difficult to understand. People chase investments only after most of the success they can deliver is behind us. Investors also tend to overpay for successful ideas, and the valuation they pay becomes their biggest risk. These are behavioural decisions, clearly driven by herd mentality.

Yet, we forget past lessons and end up making the same mistakes. This is why sustained investment outperformance is so difficult over long periods. Let's take stock of where ...