3 Attributes Of Good Investing
January 31, 2022 2022-01-31 23:303 Attributes Of Good Investing
3 Attributes Of Good Investing
For many new investors, investing seems complicated and uncomfortable. One of the reasons for this is because you have to invest a large sum of money at once. This can be very scary for many investors who feel that they need to “get it right” from the beginning or they will lose everything. When your money is spread out among different investments, you are less likely to feel panicked.
Investing is a marathon, not a sprint. Investing on a regular basis with the goal of saving for long term goals will keep you sane and financially secure.
Investing is about balance and investing in a way that keeps your emotions in check can help you find that balance.
Here are three ways to find good investing habits:
1) Keep score. Recording how your investments are doing helps you learn from your experiences and assess whether your financial goals are likely to be achieved.
2) Limit the number of choices. Research has shown that having more choices increases anxiety (and therefore reduces the likelihood you’ll make a decision). Limiting yourself to 3-5 investments will reduce your anxiety and make it easier for you to invest regularly.
3) Take risks when necessary, but minimize them by diversifying. A well balanced portfolio will include investment vehicles such as stocks, bonds, real estate, mutual funds and more. While it would be nice to find the perfect stock that will triple in value overnight, statistics show it just doesn’t happen often, so take calculated risks when necessary but diversify as much as possible to minimize them as much as possible.
Ultimately, the three attributes of good investing come down to the three simple statements. Rather than encouraging you to follow one particular strategy, we like to provide you with the tools and skills to formulate your own. In this way, your investing style is a direct reflection of your personality and overall goals. Some investors concentrate on short-term gains, others aren’t concerned about capital gains at all. Again, it all comes down to what’s most important for you. But at the end of the day, if you stick with the basics (don’t put too much in any one investment, don’t trade impulsively), it’s not that hard to succeed. Good luck!