Stop Dating Volatile Stocks: It Is Time To Bond With Stability

Love Hurts, So Do Markets

We all have been there. That one charming guy who says all the right things, texts you nonstop for a week, and then disappears without a trace. Investing in stocks can feel eerily similar. One day, you are riding high on returns, the next, you are strangely ghosted by the market.

Welcome to the emotionally unavailable world of finance. Stock market volatility in India has some serious commitment issues. Price swings are wild, commitment is questionable, and you are left wondering what went wrong. No wonder more investors today want to avoid volatile stocks, invest in bonds, and seek relationships- financial or otherwise- that are a little more stable.

For the everyday investor, this is not just about red or green lines on a screen, it is about emotional investing mistakes that cost real money. It is that gut-punching feeling when your favourite stock drops 15% overnight because of a bad earnings report. It is buying into a hype rally and watching your portfolio nosedive the moment the excitement fades.

In dating, we call it “toxic.” In markets, we call it “volatility.” And in both cases, the signs are always there. But we are always too blind to see them. 

Red Flags To Watch In A Stock

What are the signs of bad stocks, the ones that give you all the wrong vibes but still tempt you anyway?

Here are the major red flags in stocks that investors should look out for:

1. Overhyped Without Fundamentals

If a stock is trending everywhere but has no solid earnings, business model, or real path to profit, it is the finance version of “all talk, no action.” This is a classic case of overpromising and underdelivering. Such stocks ride the wave of a FOMO-driven rally, but when the hype dies, so does your return.

For context, a 2024 analysis of 3,522 BSE-listed revealed that 920 scrips delivered multibagger returns over the previous year¹. Yet, nearly one-third of these firms recorded lower revenue during the 9MFY24 compared to prior FY23. 

Take Alok Industries as a case in point. The Reliance-affiliated textile entity booked a net loss of INR 630.18 crore across the first three quarters of FY24. This was nearly 8% higher than its loss of INR 582.19 crore in the same stretch of the prior fiscal. 

Despite this loss, its equity appreciated by 122% over that financial year. Yet, by 13 June 2025, the one-year return had fallen to (-26.72%)².

Hence, if a company’s value is based on vibes rather than fundamentals, that is a major warning sign.

2. Moody Price Swings

One day it is up 10%, the next day it is down 12%. It is exhausting, unpredictable, and leaves you constantly checking your phone for updates. Some stocks are just naturally more volatile, and while they are not always bad, it is not ideal if you are looking for long-term peace of mind. Volatility can create opportunities, but too much drama can lead to sleepless nights and second-guessing your choices.

Extreme stock market volatility in India post-2020 has made this clearer than ever. Companies and sectors with less or inconsistent earnings exhibited these mood swings. Stocks of sectors such as transport, the entertainment industry, and oil & gas crashed down more than 40%³. This is some real volatility to deal with. 

3. No Clear Future (Aka: No Earnings Visibility)

If a company says, “We are focused on growth, not profitability right now,” consider it the equivalent of “I’m not ready for commitment.” Companies with no predictable revenue or clear roadmap to profitability are playing it fast and loose with your money. If their future is uncertain, your investment probably is too.

4. They Love Your Money, Not You

Be aware of the companies that constantly raise capital, dilute shares, or make grand acquisitions without any results. They are just using investor money to fund big dreams, but you’re left holding the emotional baggage (aka losses).

Fortunately, there are pragmatic ways to address all these red flags. Platforms like Grip invest bond’s marketplace help you filter out the drama by offering more stable, fundamentals-driven options. Additionally, you can also explore alternatives to risky stocks, like bonds.

Why Chasing Volatile Stocks Can Burn You

1. Emotional Investing = Expensive Mistakes

We all have been there, panic selling at a loss, buying at the peak, revenge-trading after a dip.  But, in investing, these emotional decisions have real financial consequences. When you are investing based on hype or fear rather than strategy, you are setting yourself up for major heartbreak.

According to SEBI and market analysts, almost  93%  of retail investors in India lost their capital⁴. Not because of poor stock selection, but because of poor timing driven by emotion. Volatility plays mind games, and most people can not handle it without a strategy.

2. High-Risk ? High Return (Always)

That “bad boy” stock might promise big things, but without stability, the risks often outweigh the rewards. Some high-risk stocks deliver, but many others destroy capital. Think of Yes Bank (crashed 6%), Jet Airways (drastic fall of 41%), or even newer fintech darlings who collapsed after regulatory pressure⁵. 

While diversification helps, the core idea is this: just because it’s exciting doesn’t mean it’s worth it. And in 2025, investors are waking up to this reality.

Bonds: The Reliable Ones

We have seen the consequences of sticking to the wrong ones. It is time to stop dating chaos and start building a relationship with someone,  or something, honestly stable. If stocks are the charming heartbreakers, bonds are the reliable, emotionally available partners you can build a life (or a portfolio) with. 

Bonds are debt instruments where you lend money to a company or government in exchange for regular interest payments and the return of your principal at maturity. These are fixed-income investments in India that provide stability even in the most volatile markets. 

1. Steady Returns, Lower Drama

Unlike stocks that react to every headline, bonds offer predictability. You know what you are getting, fixed interest, set timelines, and usually your principal amount back. They do not ghost you or swing wildly based on rumours. They are like the good partners that we all need in life. 

Take an example of this high-yield return, senior secured bond- Manba Finance Bond. The Company has shown steady improvement in profitability, with PBT margin increasing from 16.3% in FY23 to 21.3% in YTD Dec’24. PAT margins have remained stable at a healthy 16.3%.

2. Fixed Income > Mood Swings

Especially in a market as unpredictable as 2025, bonds are your calm in the storm. They offer predictable returns with significantly lower risk compared to stocks with major mood swings. Investors today are shifting to safe investment options in India, and rightly so. Whether it is government bonds or any corporate bonds, they provide a much-needed anchor for your portfolio.

Many listed bonds on Grip now offer monthly or quarterly interest payouts. Do check out the app for more information and tips on where to invest your lovely money!

Why More Investors Are Bonding In 2025

In today’s market, investors are craving stability, and they are finding it in fixed-income assets.

1. Higher Yields, Lower Stress

2025 is the year of the smart investors. As India is gearing up to achieve a US$7-8 trillion economy within the next five years, a significant portion of this capital formation is expected to be driven by the expanding bond markets, currently valued at $2.69 trillion.⁶

As interest rates stabilise in bonds and high-quality private companies turn to debt markets, high-yield bonds in 2025 are looking attractive. Retail investors can now get returns as high as 10–12% annually,  without the gut-wrenching swings of equity markets.

2. Grip’s Bond Marketplace: Find Your Match

Grip Invest is making investing in corporate bonds seamless. With a minimum investment limit (as low as INR 10,000), and various liquidity options, it is becoming a go-to alternative to risky stocks. Think of it as Tinder,  but instead of flaky flings, you find long-term, financially fulfilling relationships. 

The added benefit? You are not stuck with a confusing demat process. Everything is transparent, regulated, and built for modern investors.

Conclusion: Swipe Left on Volatility, Swipe Right on Bonds

Falling in love with a stock is easy. But building long-term wealth requires discipline, clarity, and a little emotional detachment. If stock market volatility is giving you commitment issues, it is okay to walk away.

Now is the time to mature as an investor. And that means it is time to stop making emotional investing mistakes. In fact, stable investments like bonds might just be the ones that love you back, with consistent returns, peace of mind, and financial growth.

So the next time a stock looks too volatile to handle, ask yourself: Is this love… or just drama?

FAQs On How to Avoid Volatile Stocks & Invest In Bonds

1. What does volatility in the stock market really mean?
Stock market volatility refers to how much a stock's price fluctuates in a given time. High volatility means big price swings, often due to uncertainty or speculation.

2. Are volatile stocks always risky to invest in?
Not always, but they demand more attention, timing, and risk tolerance. For most investors, especially beginners, they can lead to emotional and financial instability.

3. How can I reduce the risk in my portfolio in 2025?
Diversification across asset classes can give you stability. Balance growth stocks with safer assets like bonds, which offer regular returns and capital protection. Platforms like Grip make this easier than ever. 

References:

1. Outlook Business, accessed from: https://www.outlookbusiness.com/markets/markets-mania-the-multibagger-hype-is-hiding-bad-fundamentals??

2. Google Finance, accessed from: https://www.google.com/finance/quote/ALOKINDS:NSE?sa=X&ved=2ahUKEwiLuYTeyfCNAxU63jgGHbcFJssQ3ecFegQILxAT&window=1Y

3. National Library Of Medicine, accessed from: https://pmc.ncbi.nlm.nih.gov/articles/PMC7543764/

4. SEBI, accessed from: https://www.sebi.gov.in/media-and-notifications/press-releases/sep-2024/updated-sebi-study-reveals-93-of-individual-traders-incurred-losses-in-equity-fando-between-fy22-and-fy24-aggregate-losses-exceed-1-8-lakh-crores-over-three-years_86906.html

5. The Economic Times, accessed from: https://economictimes.indiatimes.com/markets/stocks/news/after-market-jet-crashes-41-yes-bank-plunges-6-121-stocks-signal-fall-ahead/articleshow/69842760.cms?from=mdr

6. The Economic Times, accessed from: https://economictimes.indiatimes.com/markets/bonds/2-69-trillion-and-counting-how-indias-bond-market-is-powering-a-8t-future/articleshow/119401928.cms?from=mdr

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