It takes not just linear time, ticking minute after minute, day after day, and year after year – but emotional time and maturity.
Think of time in these terms: Time = Things I must experience, things I must endure.
For every investor, there will be times of great pain and self doubt. These times will create fear, anxiety and stress.
We continue to ask, ‘am I doing the right thing?’ ‘is this advice in my best interest or in the best interest of the adviser and their company?’ ‘Should I be in the stock market or out of it?’ The questions are never ending.
Many investors during a market down turn will change advisers. They will find an adviser who did better during the downturn and move to them. I call this, musical brokers.
We attempt to compare our portfolio strategy with a neighbor or friend. Unfortunately, our focus is on short term results. The results from month to month are really, meaningless to a true investor.
Gamblers/speculators are focused on short term results. Their focus is on immediate results. If the results are not favorable they will seek to adjust their strategy. Many will say ‘it just isn’t my day’. They continue to search for the ‘hot thing’. They continue to seek out the way to make a ‘killing’.
Please keep in mind successful investors focus on the horizon. There is no quick, easy way out of the pain of down markets. They must be faced and endured to earn financial and emotional success.
Many are not really looking to invest but rather are looking for action. These are the traits of gamblers/speculators.
There is no long term, substitute for a disciplined strategy process with investing. Anything else would be speculating.
Process is the most important component of any investment strategy. Investors must choose an investing process and stick with it.
In my experience – it is impossible to eliminate emotions from the investing process. Because everyone is human. The trick is to harness them in empowering ways.
You must own equities…globally diversify…rebalance.