Don't Miss Out On New Opportunities Because Of FOGI Syndrome

In the investing arena, you will find many challenges. New types of biases and behavioural issues will crop up to make the game a tough one to navigate.

Let’s tackle the one that investors who burn their fingers during their early foray in the markets—fear of getting in or FOGI.

Around late 2022, Priyanshi Jha, 25-year-old advocate from Delhi, made her first move into the stock market. It wasn’t a carefully thought-out decision backed by research or a financial plan. It started, instead, with a seemingly harmless stock tip from a senior colleague for Reliance Naval & Engineering. “There was a lot of buzz around private defence manufacturing and I didn’t want to miss the opportunity,” she recalls.

However, the optimism didn’t last long. Within a few months, the stock began to tumble. She had invested close to `15,000, but by the time she exited, the stock had lost more than half its value.

She booked a loss of `7,000-8,000 in mid-2023, when Reliance Naval was on the brink of being delisted from the stock exchanges as part of a resolution process under the Insolvency and Bankruptcy Code (IBC). On July 14, 2023, Reliance Naval’s shares were officially delisted as part of a capital reduction plan. The company was relisted in January 2025 under a new name—Swan Defence and Heavy Industries.

For Priyanshi, the setback was not just about the money she lost. “It had a deep psychological impact on me. It made me disproportionately wary of the markets. That one experience created a long-standing hesitation in me,” she says. She was clearly in the grip of FOGI.

What Is FOGI?

FOGI is the fear that sets in after a bad first experience, usually at investing.

Anurag Agnihotri, assistant professor, commerce, College of Vocational Studies, Delhi University, says it often stems from a lack of financial understanding, or from past investment losses. “Many people who faced losses during turbulent times, like Covid, when stocks crashed and businesses were shut, developed a permanent hesitation about the markets,” he says.

It doesn’t just breed fear but also a lack of confidence that either stems from limited knowledge or overwhelming peer pressure.

Alekh Yadav, a CFA and head of investment products at Sanctum Wealth, says it’s tied closely to a behavioural bias called loss aversion (Don’t Lose Out To Loss Aversion). Adds Yadav: “Loss aversion is a well-known emotional bias where investors dislike losses more than they enjoy equivalent gains.”

Those who have experienced negative investment outcomes often become hesitant to re-enter the market. Additionally, recent returns—whether positive or negative—can either intensify or ease the fear of going in,” he adds.

How To Overcome FOGI?

Start Small: Start with smaller investments to reduce the anxiety of losing money in the market. If the loss is small, you could try investing again.

Start Safe: It’s best to play safe for new investors. Consider large-cap or hybrid mutual funds or bluechip stocks, which are considered relatively safer, instead of going for new companies or following the trends.

Start SIPs: Systematic investment plans (SIPs) of mutual funds instil discipline by enabling regular, fixed investments. They average out the ups and downs of the market if held for long.

Go Gradual: Increase your exposure to riskier assets gradually after you have built the confidence to tackle market volatility.

Be Strategic: Eventually, to regain confidence, come up with a well-defined investment strategy, maybe with the help of a trusted financial advisor.