WHEN MARKETS IGNORE NOISE
Executive Summary Financial markets often appear to absorb shocks that dominate headlines without leaving a lasting impact on long-term returns. Investors tend to place significant importance on geopolitical crises, policy debates, and short-term disruptions. Yet over time, many such events seem to fade in importance, though the reasons are not always easy to see when they are occurring. What appears to matter more are occasional, structural shifts in the global economy. The art, it seems, is in learning to tell the two apart. The Persistent Overreaction Cycle Markets are frequently described as forward-looking and rational, but investor behaviour can suggest otherwise. Each cycle brings a new set of anxieties that feel existential in the moment. For Indian investors, the rupee crisis of 1991, the Kargil conflict, demonetisation in 2016, and the Covid crash of March 2020 all triggered periods of genuine panic, yet those who remained invested often fared better. Pa...