CalMeK, I like your view to feel optimistic about the world. I believe the world gets better every decade, but not necessarily every year, definitely not every month. It can get worse in the short term.
Mike Milken at the end of the day went to jail. If one reads Den of Thieves or Liars Pokers, one will realize those are not great examples. What Seth Klarman (Bio tech start-ups), Ajay Piramal (Vodafone / Reality deals), Rakesh J (Spice Jet) and Buffett (GE / GS / Derivatives) get as value deals are today’s capitalistic opportunism available only to them in recognition of their size. Such deals are not available to you and me. They make their money there to make their averages look super impressive. Their results without these sugar coated deals are still impressive. No doubt. What they got, when they were small and smart as deals in 70s,80s US and 90s India are not easily available today. Markets are more efficient today. May be not in micro caps, but super risks exist there unless you know the management a little more than web research. Some people like Ayush, Donald here do that. But not the average couch investor like me. Market is mostly efficient (or efficient most times) and is inefficient in large caps at most for 4-6 months until new cash comes. That’s when I get an advantage. Mid caps and small caps can remain inefficient for longer periods till large cap rallies.
What is suggested as 10K every month is programmatic investing and not value investing. People have lost their shirts and pants in US from '58 (a mid bottom) to '74 (another mid bottom), while the economy did reasonably ok (don’t want to scare with depression / dot com data as they follow bubbles). Hold forever is a conspiracy by the financial institutions (commission driven) and super rich who can’t sell anyway.
If you look at 2002, 2008, 2011 and their related metrics (past and forward - be it PE, PBV, DCF, EPS Growth rate), it is very different to today. 2008 - EPS expanded by 20% even after the market fell for a few months. It had huge tail wind. Not today. There was one industry 20% weight (IT) generating 30%+ RoI. Not today. 5% growth and redistribution of returns to maintain RoI. Banks had better balance sheet. Not today. Have 2002 NPAs. Midcaps had net cash. Not today. Have Net debt. A 20% fall from the top per se does not make it attractive. Remember earnings have fallen 10% during this time, on an average. An effective fall is only 10%.
My average holding period is 3+ years, Read a lot on value investing etc. Hardcore numbers person, conservative etc. Also worked for a Top 3 capital markets firm in US through the crisis. More importantly I know my limitations as a retail investor. As Charlie Munger says (paraphrased) - “The biggest risk is when you believe your IQ is 150, it is actually 140.”