Survivorship bias shapes perceptions of stock market success

An analysis shows how selective reporting of investment predictions creates an illusion of expertise in equity markets.

The piece explains that by highlighting only successful stock picks while ignoring failures, individuals can fabricate a flawless record of market calls. This survivorship bias extends to equity investing, where participants often pursue multibagger stocks without accounting for the specific conditions required for such outsized gains to occur.

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U.S. stocks have risen for six straight weeks, led by technology shares and semiconductors.

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Twenty-three companies in India's BSE 100 index have delivered weak annual returns over the past three years. Many of these stocks now trade below their historical valuations. The underperformance is concentrated in consumer, IT and BFSI sectors.

A weekly survey by the American Association of Individual Investors showed bullish sentiment among respondents dropping sharply to 30.4 percent. The figure marks the lowest level recorded so far in 2026.

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BNP Paribas analyst Kumar Rakesh has cautioned investors against viewing largecap Indian IT stocks as a straightforward value play. He points to weak FY27 guidance, AI-led disruptions, and stalled client spending as major challenges. Buybacks and dividends offer some support, but earnings risks remain high.

Several prominent Indian investors experienced notable portfolio losses during the first quarter amid a sharp market downturn. Hemendra Kothari and Mukul Agrawal saw declines exceeding 25 percent. Madhusudan Kela's holdings dropped by 21 percent.

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The Fidelity Large Cap Stock Fund posted a quarterly return of negative 1.90 percent for the first three months of 2026. This result exceeded the negative 4.33 percent decline recorded by the S&P 500 index over the same period.

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