Here's how you can build wealth in small steps

The secret mantra for building wealth in the stock markets is simple — there is no secret mantra. All you need is discipline, patience and the courage of conviction. In this race, the slow and steady tortoise always wins over the fleet-footed hare.

The power of one

One share may seem too small an investment to make a meaningful impact on your portfolio’s returns. But if you bought one share of blue-chip companies such as Infosys, HDFC Bank and Larsen & Toubro every month starting July 2010, your investment of Rs 4.55 lakh would be worth Rs 6.92 lakh today. Plus you would have also received Rs 18,543 in dividends.



We show you how much you would have accumulated in five years. All investments were made on the first trading day of each month.



But mutual funds did better

While staggered purchases of these blue-chip stocks gave high returns, they could not beat mutual funds. If, instead of buying one share every month, an equal amount was put in the best performing sector fund, the investment would have yielded higher returns.