Being a good investor is like being a good sportsperson in sports, it takes consistent improvement every day. And the good investor will always have the routine, just like a sportsperson has their workout plan.
Human has evolved emotions towards money nowadays. which gives rise to a lot of emotional roller coaster rides when we have invested our money in a volatile market. And we experience many different emotional feelings depending on how markets are reacting.
Being a good investor is like being sherlock homes in the detective world. So,
what it takes to be a good investor?
- Observant, being mindful about what is happening around us is important, and processing those information and using that information to adapt our portfolio is key
- Good investors understand crowd psychology and use this information to their advantage. A good investor will not try to be bear in the group of bulls and wise versa
- Having a good emotional coefficient is key to an investor. As we know, we are very much attached to our money, but when we don’t take out our money from bad investment then we will be like a frog inside a boiling pot.We have to take our money and jump out if the investment/trade becomes too hostile. Like a lizard shedding its tail to protect itself from danger.You should always know when to exit.Our emotions should not be entangled like the pointer on the volatile graph, we should detach our emotions from the outcome of the process and stick to our plan.
- Having knowledge of what we have invested in is important. often many investors take advice from social media or TV and invest their money, something which they don’t understand. At all costs, we have to take time to understand what we are investing in. in simple words, we should have vertical knowledge of what we are investing in.
- Negotiation is a key skill any investor should have. Good investors know profits are made when buying at the right price and not when we are selling at market price. I had written a blog about how to negotiate? So will not try to explain much about this point here.
Note this is not an exhaustive list, being a good investor means having the right mindset towards money, emotions, and information on which we are acting upon.
Have a good investment. I will see you on my next blog.