The Art of Doing Nothing: Why the Best Investors Often Take No Action

Imagine you own a sapling. You water it once daily, let it bask in the glorious morning sunlight, once in a while you check if any fertiliser or pesticides is needed and then—you do nothing. You don’t dig it up every day to check the roots. You don’t move it from pot to pot every week. You let it grow.

Investing is the same. The best returns don't come from constant action, but from patience. Yet, many investors behave like restless gardeners, digging, shifting, tweaking—only to wonder why their tree never grows.

Overtrading: The Silent Killer of Wealth

The stock market is designed to transfer money from the active to the patient. – Warren Buffett.

In 2019, SEBI released a report showing that 89% of active traders in India lost money. Another study by Zerodha found that only 1% of traders consistently make profits over the long run. The problem? Overtrading. 

Why does overtrading harm returns?

1. More trades = More costs  Every trade comes with brokerage fees, taxes, and slippage. Even if you're only paying 0.1% per trade, making 100 trades a year eats up a good chunk of returns. Having lots of traders is great for the broking industry but it's harmful for you as a retail investor.

   
   

2. Emotions take over The more you trade, the more you let fear and greed dictate decisions. In 2020, when markets crashed, investors who panic-sold missed out on one of the strongest bull runs ever.

   
   

3. Missing compounding Rakesh Jhunjhunwala bought Titan in 2002 and barely touched it. That stock went from ₹40 to ₹3,000. Imagine if he had sold for a quick 50% profit instead.

   
   

(One Caveat - You can and should try trading with a small amount and understand if you are able to enjoy it & more importantly if you are able to consistently make money irrespective of market cycles.)

The Power of Long-Term Holding

Charlie Munger is famously quoted, "The big money is not in the buying and selling, but in the waiting."

Let’s take an example from Indian history—HDFC Bank. If you invested ₹1 lakh in HDFC Bank in 2002, and simply did nothing, that investment would be worth over ₹1 crore today. That’s the power of doing nothing. 

I am sure all of us know someone who made money in the stock market mainly because investing or trading was not their source of income, but only a place where they parked money for long periods of time. Only focussing on increasing their income & increasing their investible corpus. Investing is one of the few things in life where not doing anything can still have you in the top 10 percentile of players in the game. 

One reason why most people don't hear of great retail long term investors & stocks is because the great investors don't go out and shout their investment returns. Quite simply they don't need to, they are not in the business of investing & hence don't need to do it. Great returns are those that take care of your material well being.

Case Studies of Investors Who Rarely Trade

1. Radhakishan Damani – The Silent Billionaire

Radhakishan Damani, founder of Avenue Supermarts (DMart), is known for his patient approach. He invested in VST Industries and India Cements, holding them for years.

2. Chandrakant Sampat – India’s Forgotten Value Investor

Chandrakant Sampat, one of India’s earliest value investors, was a master of "buy and hold." He invested in FMCG giants like HUL, Nestlé, and Pidilite in the 1980s and held them for decades. His belief? “Great businesses compound quietly over time. Let them.

3. Warren Buffett – The Ultimate Long-Term Investor

Buffett bought Coca-Cola stock in 1988 and still holds it. His strategy is simple: buy great businesses and let compounding do the work.

The Psychological Edge of Doing Nothing

Behavioural finance tells us that humans are wired for action. The urge to "do something" is strong, even when it’s harmful. This is why:

• We take meds for the common cold which will heal us in 7 days vs not doing anything which will heal us in a week. 

• There is a perverse presence of over - optimisation in everything.

• We constantly check stock prices (instead of checking stock & industry reports), even when holding is the best strategy.

  
  

The best investors overcome this bias. They train themselves to ignore noise, avoid daily market updates, and stick to their investment thesis. 

But doing nothing is a skill and an art. Ask a master procrastinator (yours truly) about doing nothing & he will tell you all about it, or maybe he will take some time to tell you.

How to Master the Art of Doing Nothing

1. Build a strong portfolio and let it be 

   Buy fundamentally strong companies or mutual funds and stop checking their prices every day.

   
   

2. Turn off the news 

   Financial media profits from making you anxious. Ignore daily headlines. Focus on your work, hobbies, side gigs, etc aka things you enjoy doing with people you enjoy being around.

   
   

3. Use a "3 Month" Rule

   Before selling a stock, wait 3 months. Most impulsive decisions look foolish after some time. (This only applies if you have done the research.)

   
   

4. Automate investments 

   SIPs (Systematic Investment Plans) are a great way to invest without emotional interference if you want to invest for long periods of time.

   
   

Final Thoughts

Most investors lose money not because they don’t know what to do, but because they don’t have the patience to do nothing. 

The best strategy? Buy good companies, hold them, and go live your life. Let compounding do the work.

As Munger put it: "Sit on your ass investing."