Showing posts with label Education. Show all posts
Showing posts with label Education. Show all posts
Thursday, 26 February 2026
16 Proven Personality Traits of Successful Investors
The financial media is peppered with how much money this hedge fund manager makes and how expensive an art collection that professional investor owns is. While it’s interesting to follow the investor gossip, these public snapshots of generally private investment gurus are really useful for another reason: an up-close and personal window into the personality traits of successful investors.
Dissecting the psychological makeup of master investors isn’t just guesswork — there’s been a ton of research into what behaviours top investors use to make their money.
The Big Five Personality Traits of Successful Investors
In 1970, Lewis Goldberg set out to create a sort of encyclopedia of personality characteristics. Out of over 1000 traits, he was able to create 5 buckets of positive personality traits: emotional stability, extraversion, openness, agreeableness, and conscientiousness. It’s a good framework to use as we look at how these traits impact investing.
First, some quick definitions of these traits:
Emotional Stability: Relaxed and calm
Extraversion: Social, feels comfortable in presence of others
Openness: Open to new ideas, perspectives
Agreeableness: Works well with others, values cooperation
Conscientiousness: Employs sell discipline, follows rules
The Traits of Great Investors
In turn, these “Big 5” traits were recently studied by MarkeyPysch (a firm that studies this kind of stuff) and broken down to examine exactly which personality traits are shared by top investors.
In a paper published last year, the research firm ranked these five traits for how well they performed, the size of losses they caused, and how likely they are to cause investor misbehaviour.
Here’s a list of the top 16 traits of top investors:
1. Open and agreeable to new ideas: Top investors are open to learning new things, objective in their analysis, and collaborate with their teams to find investment candidates.
2. Go with the flow, carefully: Long term investors learn how to let their winners run and cut their mistakes quickly. Investors who are resistant to change typically report suffering larger losses.
3. Not exactly thrill seeking, but not cowards either: Good investors aren’t gamblers at heart. They are brave face of uncertainty and plan a course of action. Top investors don’t shirk from decision-making.
4. Resilient: Top investors embrace life. Their optimism makes them resilient investors — even in the face of setbacks. They roll with the punches, even when the rules of the investing game change in front of them. This lowers risk, too.
5. Social individualists: Best performing investors are OK in social settings but they don’t necessarily seek out yes-men friends. They want to think objectively and go against the crowd.
6. Disciplined, but not to a fault: They follow a plan of action and stay consistent. But ultimately, they’re open to being convinced of a different plan of action, at any time. There’s no silliness or acting on a whim here.
7. What pressure?: When money is on the line, people make bad decisions. Investors who perform well stay cool and calm under this stress. By not procrastinating or acting impulsively, good investors make decisions quickly and avoid bad losses.
9. Avoids crowds: Crowded trades are the ones you find pundits on TV yapping about. By the time, these talking heads learn of the trades, top investors are long gone. They avoid stocks that are everyone’s favourites.
10. Doesn’t chase hot stocks: Good investors don’t typically chase after hot investment ideas — they’re patient and wait for stocks to come to them. Investors who like trend following or blindly subscribe to expert advice report larger losses when it all hits the fan.
11. Self-aware: Investing isn’t about ignoring your emotions. Interestingly, investors who aren’t aware of their own emotions are more susceptible to bigger losses. Good investors sense danger in their guts, process it, and make a decision with their brains. That feedback loop appears important for risk management.
12. Eats humble pie: Many investing legends are massively wealthy, yet they maintain a certain level of humility that’s essential to winning at the investing game. Overconfidence blinds good decision making, kills returns and makes us open to big losses.
13. Keeps fingers off the buying button: Market Pysch’s research shows that extraverts are more likely to buy stocks as they surge upwards as well as buy them on dips.
14. Stays out of the herd: Too many times we get sucked into doing what others are doing; Herding is a bad recipe for investing success. In an effort to blend in and keep social dissonance low, agreeable investors sometimes mistakenly buy high and sell low.
15. Keeps emotions in check: Emotional investors sell quickly when stocks go up. Locking in profits is never a bad thing but it appears to be the culprit for emotional investors’ lower overall performance.
16. Doesn’t seek to confirm, disproves instead: Confirmation bias — our human need to find evidence to support our own ideas — may be at work when emotional investors buy more stock when it drops. Buying more when a stock goes down (dollar cost averaging) lowers our entry point but it ignores why the stock dropped. Good investors re-examine constantly.
This type of study — examining the traits of top investors — is important because so many books and experts sell their “infallible investing systems” (buy this stock and you’ll profit 1000% in 3 days!). Of course, that’s hogwash — but, understanding the psychological makeup of profitable investors, we now have a blueprint of exactly who these investors are and how we can learn from them. That’s good — real good.
Dissecting the psychological makeup of master investors isn’t just guesswork — there’s been a ton of research into what behaviours top investors use to make their money.
The Big Five Personality Traits of Successful Investors
In 1970, Lewis Goldberg set out to create a sort of encyclopedia of personality characteristics. Out of over 1000 traits, he was able to create 5 buckets of positive personality traits: emotional stability, extraversion, openness, agreeableness, and conscientiousness. It’s a good framework to use as we look at how these traits impact investing.
First, some quick definitions of these traits:
Emotional Stability: Relaxed and calm
Extraversion: Social, feels comfortable in presence of others
Openness: Open to new ideas, perspectives
Agreeableness: Works well with others, values cooperation
Conscientiousness: Employs sell discipline, follows rules
The Traits of Great Investors
In turn, these “Big 5” traits were recently studied by MarkeyPysch (a firm that studies this kind of stuff) and broken down to examine exactly which personality traits are shared by top investors.
In a paper published last year, the research firm ranked these five traits for how well they performed, the size of losses they caused, and how likely they are to cause investor misbehaviour.
Here’s a list of the top 16 traits of top investors:
1. Open and agreeable to new ideas: Top investors are open to learning new things, objective in their analysis, and collaborate with their teams to find investment candidates.
2. Go with the flow, carefully: Long term investors learn how to let their winners run and cut their mistakes quickly. Investors who are resistant to change typically report suffering larger losses.
3. Not exactly thrill seeking, but not cowards either: Good investors aren’t gamblers at heart. They are brave face of uncertainty and plan a course of action. Top investors don’t shirk from decision-making.
4. Resilient: Top investors embrace life. Their optimism makes them resilient investors — even in the face of setbacks. They roll with the punches, even when the rules of the investing game change in front of them. This lowers risk, too.
5. Social individualists: Best performing investors are OK in social settings but they don’t necessarily seek out yes-men friends. They want to think objectively and go against the crowd.
6. Disciplined, but not to a fault: They follow a plan of action and stay consistent. But ultimately, they’re open to being convinced of a different plan of action, at any time. There’s no silliness or acting on a whim here.
7. What pressure?: When money is on the line, people make bad decisions. Investors who perform well stay cool and calm under this stress. By not procrastinating or acting impulsively, good investors make decisions quickly and avoid bad losses.
8. Eyes on the exits: Investors should be confident of their ideas but best performers have contingency plans before they make their moves. If something doesn’t work, they exit quickly and move on.
9. Avoids crowds: Crowded trades are the ones you find pundits on TV yapping about. By the time, these talking heads learn of the trades, top investors are long gone. They avoid stocks that are everyone’s favourites.
10. Doesn’t chase hot stocks: Good investors don’t typically chase after hot investment ideas — they’re patient and wait for stocks to come to them. Investors who like trend following or blindly subscribe to expert advice report larger losses when it all hits the fan.
11. Self-aware: Investing isn’t about ignoring your emotions. Interestingly, investors who aren’t aware of their own emotions are more susceptible to bigger losses. Good investors sense danger in their guts, process it, and make a decision with their brains. That feedback loop appears important for risk management.
12. Eats humble pie: Many investing legends are massively wealthy, yet they maintain a certain level of humility that’s essential to winning at the investing game. Overconfidence blinds good decision making, kills returns and makes us open to big losses.
13. Keeps fingers off the buying button: Market Pysch’s research shows that extraverts are more likely to buy stocks as they surge upwards as well as buy them on dips.
14. Stays out of the herd: Too many times we get sucked into doing what others are doing; Herding is a bad recipe for investing success. In an effort to blend in and keep social dissonance low, agreeable investors sometimes mistakenly buy high and sell low.
15. Keeps emotions in check: Emotional investors sell quickly when stocks go up. Locking in profits is never a bad thing but it appears to be the culprit for emotional investors’ lower overall performance.
16. Doesn’t seek to confirm, disproves instead: Confirmation bias — our human need to find evidence to support our own ideas — may be at work when emotional investors buy more stock when it drops. Buying more when a stock goes down (dollar cost averaging) lowers our entry point but it ignores why the stock dropped. Good investors re-examine constantly.
This type of study — examining the traits of top investors — is important because so many books and experts sell their “infallible investing systems” (buy this stock and you’ll profit 1000% in 3 days!). Of course, that’s hogwash — but, understanding the psychological makeup of profitable investors, we now have a blueprint of exactly who these investors are and how we can learn from them. That’s good — real good.
Source: http://library.wallstreetsurvivor.com/
Sunday, 7 December 2025
The Best Investment Advice of All Time
The greatest investors follow a number of different systems, but their underlying principles tend to be similar and surprisingly simple. Here is what you can learn from their advice:
1. "Buy when there's blood in the streets." -- Baron Rothschild
Everyone thinks they know this one. Almost no one actually follows it. When your portfolio is leaking like the Titanic, why would you want to buy more? Wait a few months, and you'll usually be able to see why. Another good way to gauge the time to buy is that it feels terrible. When you feel good about a stock purchase, double check your numbers. It's easy to feel good when things are going up and up, but the long term results are likely to be disappointing.
2. "Buy a company any idiot could run, because sooner or later any idiot will be running it." -- Peter Lynch
Businesses with little competition and high profit margins can be run by almost anyone. Those with lots of competition and low margins require management genius. Stick with the simple business. Not only is it likely to do better, but you'll find it easier to decide when to sell. "Never invest in anything you can't illustrate with a crayon," Lynch said. It's still terrific advice.
3. "You won't improve results by pulling out the flowers and watering the weeds." -- Peter Lynch
People tend to think that what goes up must come down, and vice versa. While there is a tendency for stock prices to revert to the mean, a good business will continue to outperform a poor one. Selling your winners and keeping your losers is a bad plan.
4. "The best time to sell a stock is never."-- Warren Buffett
Does this mean you should really never sell a stock? No, but it means you should buy a business you'd be happy to hold for the foreseeable future. When things change for the worse you should sell, but trading in and out of the market frequently is usually a loser's game--especially for small investors.
5. "One way to end up with one million is to start with two million and use technical analysis."-- Ralph Seger
The average investor has the attention span of a two-year-old. He or she wants a way to make money now, and panics the minute a stock goes down. If someone offers complicated charts and formulas that promise quick profits, the ears perk up. The more complicated the method, the more appealing it is. Enter the voodoo practitioners, in the form of technical analysts. Of course technical analysis works some of the time. Everything works some of the time. But if you want a sure fire way to long term riches, look at the fundamentals and forget the fancy charts.
6. "The four most dangerous words in investing are 'This time it's different.'" -- John Templeton
The tech wreck is a recent example of this lesson, which investors never seem to learn. If you're being told that the market will perform in a way it never has in recorded history, be extremely skeptical. If someone starts talking about a "new paradigm," take your money and run for the hills.
7. "If the world's economists were laid end to end, they would all point in different directions." -- Arthur Motley
Calling economics a science is like calling an astrologer a life planner. Economists can't predict what will happen next month or next year with any degree of reliability. The best thing you can do is forget trying to predict the economy and invest for the long term. The ever-witty Peter Lynch put it another way: "If all the economists in the world were laid end to end, it wouldn't be a bad thing."
8. "An effective zero percent interest rate for hiding in a foxhole is prohibitive." -- Bill Gross
When people get scared, they flee to bank accounts and T-bills, even when the rates are laughable. But unless you take risks with some of your money, you effectively lose money all of the time, due to the eroding effects of inflation-which never seems to get as low as the interest rate on your bank account. Only in a time of rapid deflation would you want to keep most of your money in cash.
9. "The person that turns over the most rocks wins the game."-- Peter Lynch
Look at two stocks, and you'll probably find two so-so buys. Look at twenty or thirty, and you're likely to find a couple that look extraordinarily good. Looking at lots of options is the secret of finding winners.
10. "In this business, if you're good you're going to be right six times out of ten." You're never going to be right nine times out of ten."-- Peter Lynch
Of course by "good" Lynch might have meant himself. You'd better make that four out of ten if you're not Peter Lynch. It doesn't matter. If you make four great picks, you'll still do just fine.
11. "A lot of great fortunes in the world have been made by owning a single wonderful business." -- Warren Buffet
When you know you have a great idea, place a sizeable bet and have some patience. Look at the twenty-year returns of some of the world's greatest businesses and you'll be astonished. Remember, though, that those companies are unlikely to repeat that performance because they've gotten too large to grow quickly. The key to finding big winners is to find little companies with big prospects.
You may have heard these before but, this time, take them to heart. Use these rules to invest until it becomes second nature. Hang in there, even if things don't go your way at first. In the short term, you may think you're crazy to follow some of this advice. But look at your returns in five years or ten, and you'll begin to understand how the rich get richer.
By Anthony Bae
Article Source: http://EzineArticles.com/6550005
1. "Buy when there's blood in the streets." -- Baron Rothschild
Everyone thinks they know this one. Almost no one actually follows it. When your portfolio is leaking like the Titanic, why would you want to buy more? Wait a few months, and you'll usually be able to see why. Another good way to gauge the time to buy is that it feels terrible. When you feel good about a stock purchase, double check your numbers. It's easy to feel good when things are going up and up, but the long term results are likely to be disappointing.
2. "Buy a company any idiot could run, because sooner or later any idiot will be running it." -- Peter Lynch
Businesses with little competition and high profit margins can be run by almost anyone. Those with lots of competition and low margins require management genius. Stick with the simple business. Not only is it likely to do better, but you'll find it easier to decide when to sell. "Never invest in anything you can't illustrate with a crayon," Lynch said. It's still terrific advice.
3. "You won't improve results by pulling out the flowers and watering the weeds." -- Peter Lynch
People tend to think that what goes up must come down, and vice versa. While there is a tendency for stock prices to revert to the mean, a good business will continue to outperform a poor one. Selling your winners and keeping your losers is a bad plan.
4. "The best time to sell a stock is never."-- Warren Buffett
Does this mean you should really never sell a stock? No, but it means you should buy a business you'd be happy to hold for the foreseeable future. When things change for the worse you should sell, but trading in and out of the market frequently is usually a loser's game--especially for small investors.
5. "One way to end up with one million is to start with two million and use technical analysis."-- Ralph Seger
The average investor has the attention span of a two-year-old. He or she wants a way to make money now, and panics the minute a stock goes down. If someone offers complicated charts and formulas that promise quick profits, the ears perk up. The more complicated the method, the more appealing it is. Enter the voodoo practitioners, in the form of technical analysts. Of course technical analysis works some of the time. Everything works some of the time. But if you want a sure fire way to long term riches, look at the fundamentals and forget the fancy charts.
6. "The four most dangerous words in investing are 'This time it's different.'" -- John Templeton
The tech wreck is a recent example of this lesson, which investors never seem to learn. If you're being told that the market will perform in a way it never has in recorded history, be extremely skeptical. If someone starts talking about a "new paradigm," take your money and run for the hills.
7. "If the world's economists were laid end to end, they would all point in different directions." -- Arthur Motley
Calling economics a science is like calling an astrologer a life planner. Economists can't predict what will happen next month or next year with any degree of reliability. The best thing you can do is forget trying to predict the economy and invest for the long term. The ever-witty Peter Lynch put it another way: "If all the economists in the world were laid end to end, it wouldn't be a bad thing."
8. "An effective zero percent interest rate for hiding in a foxhole is prohibitive." -- Bill Gross
When people get scared, they flee to bank accounts and T-bills, even when the rates are laughable. But unless you take risks with some of your money, you effectively lose money all of the time, due to the eroding effects of inflation-which never seems to get as low as the interest rate on your bank account. Only in a time of rapid deflation would you want to keep most of your money in cash.
9. "The person that turns over the most rocks wins the game."-- Peter Lynch
Look at two stocks, and you'll probably find two so-so buys. Look at twenty or thirty, and you're likely to find a couple that look extraordinarily good. Looking at lots of options is the secret of finding winners.
10. "In this business, if you're good you're going to be right six times out of ten." You're never going to be right nine times out of ten."-- Peter Lynch
Of course by "good" Lynch might have meant himself. You'd better make that four out of ten if you're not Peter Lynch. It doesn't matter. If you make four great picks, you'll still do just fine.
11. "A lot of great fortunes in the world have been made by owning a single wonderful business." -- Warren Buffet
When you know you have a great idea, place a sizeable bet and have some patience. Look at the twenty-year returns of some of the world's greatest businesses and you'll be astonished. Remember, though, that those companies are unlikely to repeat that performance because they've gotten too large to grow quickly. The key to finding big winners is to find little companies with big prospects.
You may have heard these before but, this time, take them to heart. Use these rules to invest until it becomes second nature. Hang in there, even if things don't go your way at first. In the short term, you may think you're crazy to follow some of this advice. But look at your returns in five years or ten, and you'll begin to understand how the rich get richer.
By Anthony Bae
Article Source: http://EzineArticles.com/6550005
Thursday, 30 October 2025
40 Gems for Traders and Investors
01. There are only three kinds of investors – those who think they are geniuses, those who think they are idiots, and those who aren't sure.
02. One of the clearest signals that you are wrong about an investment is having the hunch that you are right about it.
03. Investors who focus on price levels earn between five and ten times higher profits than those who pay attention to price changes.
04. The only way to be more certain it’s true is to search harder for proof that it is false.
05. Business value changes over time, not all the time. Stocks are like weather, altering almost continually and without warning; businesses are like the climate, changing much more gradually and predictably.
06. When rewards are near, the brain hates to wait.
07. The market isn't always right, but it’s right more often than it is wrong.
08. Often, when we are asked to judge how likely things are, we instead judge how alike they are.
09. Most of what seem to be patterns in stock prices are just random variations.
10. In a rising market, enough of your bad ideas will pay off so that you’ll never learn that you should have fewer ideas.
11. The more often people watch an investment heave up and down, the more likely they are to trade in and out over the short term – and the less likely they are to earn a high return over the long term.
12. Investing is not you versus “Them”. It’s you versus you.
13. The single greatest challenge you face as an investor is handling the truth about yourself.
14. Hindsight bias keeps you from feeling like an idiot as you look back – but it can make you act like an idiot as you look forward.
15. Ignorance of our own ignorance haunts our financial judgments.
16. Investing requires taking a stand on at least some of the uncertainties that the future holds. So your goal is to be as sure as possible that you don’t think you know more than you really do. How much you know is less important than how clearly you understand where the borders of your ignorance begin. It’s not even a problem to know next to nothing, as long as you know you know next to nothing.
17. Being part of the herd is fun while it lasts, but it’s seldom lucrative for very long, and it’s impossible to predict when the herd will change its “mind.” If you want to make more money than other people, you can't invest like other people.
18. Knowing, or even imagining, that someone else is relying on your advice can make you feel more accountable, forcing you to go beyond your gut feelings and fortify your opinions with factual evidence.
19. Find out who has a negative view and give this devil’s advocate a full hearing.
20. Whether you should take a risk depends not just on the probability that you are right but also on the consequences if you are wrong. You must always weigh how right you think you are against how sorry you will be if you turn out to be mistaken.
21. We are often most afraid of the least likely of dangers, and frequently not worried enough about the risks that have the greatest chances of coming home to roost.
22. When an intangible feeling of risk fills the air, you can catch other people’s emotions as easily as you can catch a cold.
23. Overreacting to raw feelings “blinking” in the face of risk is often one of the riskiest things an investor can do.
24. There’s safety in numbers only when there’s nothing to be afraid of.
25. Many of the world’s best investors have mastered the art of treating their own feelings as reverse indicators. Excitement becomes a cue that it’s time to consider selling, while fear tells them that it may be time to buy.
26. A mistake that stems from an action hurts worse than a mistake that results from inaction.
27. Once you have a handful of options, adding even more choices will lower you odds of making a good decision and increase your chances of regretting whatever decision you do make.
28. The harder the choice feels, the less people want to choose. Yet, the threat of having less choice almost always disturbs us.
29. The closer you come to hitting your target, the more regret you are apt to feel if you miss it.
30. The human brain is a brilliant machine for comparing the reality of what is against the imagination of what might have been.
31. There’s no end to the roads not taken.
32. Investors probably hurt themselves more by avoiding risks they imagine they might regret than by taking risks they really do end up regretting.
33. Instead of making judgments one at a time, you should follow policies and procedures that put your investing decisions on autopilot.
34. The more you can automate your investing, the easier it should be to control your emotions.
35. The pleasure you expect tends to be more intense than the pleasure you experience.
36. We often find out that what we thought we wanted before we got it is no longer what we really want once we have it.
37. There are two tragedies in life. One is to lose your heart’s desire. The other is to gain it.
38. Your memory of what was is shaped largely by what is.
39. If you focus too narrowly on the task at hand, you may never use your peripheral vision.
40. Chance favors the prepared mind.
Source:http://www.anirudhsethireport.com
02. One of the clearest signals that you are wrong about an investment is having the hunch that you are right about it.
03. Investors who focus on price levels earn between five and ten times higher profits than those who pay attention to price changes.
04. The only way to be more certain it’s true is to search harder for proof that it is false.
05. Business value changes over time, not all the time. Stocks are like weather, altering almost continually and without warning; businesses are like the climate, changing much more gradually and predictably.
06. When rewards are near, the brain hates to wait.
07. The market isn't always right, but it’s right more often than it is wrong.
08. Often, when we are asked to judge how likely things are, we instead judge how alike they are.
09. Most of what seem to be patterns in stock prices are just random variations.
10. In a rising market, enough of your bad ideas will pay off so that you’ll never learn that you should have fewer ideas.
11. The more often people watch an investment heave up and down, the more likely they are to trade in and out over the short term – and the less likely they are to earn a high return over the long term.
12. Investing is not you versus “Them”. It’s you versus you.
13. The single greatest challenge you face as an investor is handling the truth about yourself.
14. Hindsight bias keeps you from feeling like an idiot as you look back – but it can make you act like an idiot as you look forward.
15. Ignorance of our own ignorance haunts our financial judgments.
16. Investing requires taking a stand on at least some of the uncertainties that the future holds. So your goal is to be as sure as possible that you don’t think you know more than you really do. How much you know is less important than how clearly you understand where the borders of your ignorance begin. It’s not even a problem to know next to nothing, as long as you know you know next to nothing.
17. Being part of the herd is fun while it lasts, but it’s seldom lucrative for very long, and it’s impossible to predict when the herd will change its “mind.” If you want to make more money than other people, you can't invest like other people.
18. Knowing, or even imagining, that someone else is relying on your advice can make you feel more accountable, forcing you to go beyond your gut feelings and fortify your opinions with factual evidence.
19. Find out who has a negative view and give this devil’s advocate a full hearing.
20. Whether you should take a risk depends not just on the probability that you are right but also on the consequences if you are wrong. You must always weigh how right you think you are against how sorry you will be if you turn out to be mistaken.
21. We are often most afraid of the least likely of dangers, and frequently not worried enough about the risks that have the greatest chances of coming home to roost.
22. When an intangible feeling of risk fills the air, you can catch other people’s emotions as easily as you can catch a cold.
23. Overreacting to raw feelings “blinking” in the face of risk is often one of the riskiest things an investor can do.
24. There’s safety in numbers only when there’s nothing to be afraid of.
25. Many of the world’s best investors have mastered the art of treating their own feelings as reverse indicators. Excitement becomes a cue that it’s time to consider selling, while fear tells them that it may be time to buy.
26. A mistake that stems from an action hurts worse than a mistake that results from inaction.
27. Once you have a handful of options, adding even more choices will lower you odds of making a good decision and increase your chances of regretting whatever decision you do make.
28. The harder the choice feels, the less people want to choose. Yet, the threat of having less choice almost always disturbs us.
29. The closer you come to hitting your target, the more regret you are apt to feel if you miss it.
30. The human brain is a brilliant machine for comparing the reality of what is against the imagination of what might have been.
31. There’s no end to the roads not taken.
32. Investors probably hurt themselves more by avoiding risks they imagine they might regret than by taking risks they really do end up regretting.
33. Instead of making judgments one at a time, you should follow policies and procedures that put your investing decisions on autopilot.
34. The more you can automate your investing, the easier it should be to control your emotions.
35. The pleasure you expect tends to be more intense than the pleasure you experience.
36. We often find out that what we thought we wanted before we got it is no longer what we really want once we have it.
37. There are two tragedies in life. One is to lose your heart’s desire. The other is to gain it.
38. Your memory of what was is shaped largely by what is.
39. If you focus too narrowly on the task at hand, you may never use your peripheral vision.
40. Chance favors the prepared mind.
Source:http://www.anirudhsethireport.com
_________________
Sunday, 28 September 2025
Investment Vs Speculation Vs Gambling
By Sunil Sahdev
Many people do not differentiate between the following terms when they invest their hard-earned money in different asset classes, particularly in stock market and often get confused between;
1. Saving
2. Investment
3. Speculations
4. Gambling
We often use the word savings and investment interchangeably, while both are different and both are necessary to secure our future. Saving is done for purchases and emergencies while investment is being done for creation of wealth. I have heard from most of the people that they are savings for their retired life, we need to understand that if we are saving for our retired life we need to invest that money to create wealth. We need to allocate the money wisely between saving and investment, it depends upon behavior of each individual and allocation can be made accordingly. In general, we shall allocate equivalent of three to six months expenses for savings and any excess over it should be allocated for investment.
There is a razor thin differentiation between investment and speculations, in reality it depends upon our own behavior as an investor to differentiate between investment and speculation. Investment and speculative deals are generally done for real assets.
Investment can be defined as “The employment of funds to acquire certain assets after due diligence for mid to long period of time, with the objective of wealth creation and additional income in future”.
Speculative investment can be defined as “The employment of funds to acquire assets for shorter duration of time to take advantage of fluctuations in prices of underlying assets”.
However, Gambling can be defined as “The employment of funds for entertainment/fun with the chances of return depends upon probability of certain situation or events”. For example, deploying funds on horse racing can be defined as gambling.
Key differential of investment vs speculation vs Gambling is:
1. Risk Analysis and Risk appetite: Investor will generally rely on the fundamental analysis of financials and other factors which can affect the price of the asset class and their decision to invest in particular asset is based upon certain fundamental values associated with the asset. Investors do have long term risk and return perspective. While speculators generally rely on the flow of the wind without analysing any fundamentals. Speculators do take higher risk for expects higher returns in short period. Gambler risk entire capital on bet and relay mainly on luck. They are the highest risk takers and ready to lose original investment also.
2. Price of the asset: Investor does not look at the price of the asset rather it looks at the asset itself to determine the decision to allocate some money now to get some money back later on. Investor does not get influenced by daily fluctuations of the asset price, because his/her allocation of money decision is based on the intrinsic value of the assets rather then price. Speculators look at the price of the asset to allocate the money and they do get influenced by the daily fluctuations of the price of the assets, aim of the speculator is to get some quick reward. Gambling is based upon odds and bets are placed only on assumptions.
3. Time Horizon: Investors allocate money for a particular asset for longer period while speculators allocate money for shorter period, on the other hand gambler place bet for immediate gain.
4. Leverages: An investor allocates money from its own resources for investment while and speculators may also rely on borrowed money to allocate. This is applicable mainly to assets belongs to equity market. Gambler generally allocate their own money and place bet for entertainment or fun.
An individual’s approach towards investment identifies the individual either investor or speculators. If an individual is investing without fundamental analysis, only on the basis of market sentiments and certain news, for a shorter duration can be defined as speculative investor. An Individual who invests with proper fundamental analysis for longer period of duration can be defined as investor.
In conclusion, Investor will get stable return over a long run and I advise all my readers to invest wisely after proper analysis of the company to secure their hard money for fairly good chances for creation of wealth. If you are a speculator, make sure your entry and exit to the market is at right time and always be ready to higher risk of loss of original investment in worst circumstances. Gambling should be avoided always and in most of the cases gambling is not legal also.
Source: via twitter
Many people do not differentiate between the following terms when they invest their hard-earned money in different asset classes, particularly in stock market and often get confused between;
1. Saving
2. Investment
3. Speculations
4. Gambling
We often use the word savings and investment interchangeably, while both are different and both are necessary to secure our future. Saving is done for purchases and emergencies while investment is being done for creation of wealth. I have heard from most of the people that they are savings for their retired life, we need to understand that if we are saving for our retired life we need to invest that money to create wealth. We need to allocate the money wisely between saving and investment, it depends upon behavior of each individual and allocation can be made accordingly. In general, we shall allocate equivalent of three to six months expenses for savings and any excess over it should be allocated for investment.
There is a razor thin differentiation between investment and speculations, in reality it depends upon our own behavior as an investor to differentiate between investment and speculation. Investment and speculative deals are generally done for real assets.
Investment can be defined as “The employment of funds to acquire certain assets after due diligence for mid to long period of time, with the objective of wealth creation and additional income in future”.
Speculative investment can be defined as “The employment of funds to acquire assets for shorter duration of time to take advantage of fluctuations in prices of underlying assets”.
However, Gambling can be defined as “The employment of funds for entertainment/fun with the chances of return depends upon probability of certain situation or events”. For example, deploying funds on horse racing can be defined as gambling.
Key differential of investment vs speculation vs Gambling is:
1. Risk Analysis and Risk appetite: Investor will generally rely on the fundamental analysis of financials and other factors which can affect the price of the asset class and their decision to invest in particular asset is based upon certain fundamental values associated with the asset. Investors do have long term risk and return perspective. While speculators generally rely on the flow of the wind without analysing any fundamentals. Speculators do take higher risk for expects higher returns in short period. Gambler risk entire capital on bet and relay mainly on luck. They are the highest risk takers and ready to lose original investment also.
2. Price of the asset: Investor does not look at the price of the asset rather it looks at the asset itself to determine the decision to allocate some money now to get some money back later on. Investor does not get influenced by daily fluctuations of the asset price, because his/her allocation of money decision is based on the intrinsic value of the assets rather then price. Speculators look at the price of the asset to allocate the money and they do get influenced by the daily fluctuations of the price of the assets, aim of the speculator is to get some quick reward. Gambling is based upon odds and bets are placed only on assumptions.
3. Time Horizon: Investors allocate money for a particular asset for longer period while speculators allocate money for shorter period, on the other hand gambler place bet for immediate gain.
4. Leverages: An investor allocates money from its own resources for investment while and speculators may also rely on borrowed money to allocate. This is applicable mainly to assets belongs to equity market. Gambler generally allocate their own money and place bet for entertainment or fun.
An individual’s approach towards investment identifies the individual either investor or speculators. If an individual is investing without fundamental analysis, only on the basis of market sentiments and certain news, for a shorter duration can be defined as speculative investor. An Individual who invests with proper fundamental analysis for longer period of duration can be defined as investor.
In conclusion, Investor will get stable return over a long run and I advise all my readers to invest wisely after proper analysis of the company to secure their hard money for fairly good chances for creation of wealth. If you are a speculator, make sure your entry and exit to the market is at right time and always be ready to higher risk of loss of original investment in worst circumstances. Gambling should be avoided always and in most of the cases gambling is not legal also.
Source: via twitter
Saturday, 31 August 2024
20 Golden Rules of Investing to Live By
Author: Francesco Casarella
1. If it sounds too good to be true, it's definitely not true!
2. Anyone promising returns over 15% per year should be asked why they're not counted among the greatest investors like Warren Buffett, Peter Lynch, or Ray Dalio.3. To gain more, you often have to risk more, but sometimes your risk tolerance is zero (and you might not realize it).
4. Only invest in what you can explain to a 5-year-old or even a German Shepherd. In investing, complex thinking isn't necessary.
5. Minimize costs – if you're overpaying, someone else is cashing in.
6. When everyone agrees, everyone's likely mistaken.
7. Investing is like snagging a pair of top-notch shoes – it's a real deal when they're on sale.
8. Those who can, do it – those who can't just talk.
9. A great book is worth more than an expensive course.
10. Doing the right thing might make you feel foolish at times, but it eventually pays off.
11. Time is on your side: Use it as much as you can.
12. You're not your neighbor or coworker; everyone charts their own path and outcomes.
13. Diversify – remember, you're not Warren Buffett!
14. All extremes tend to balance out in the end.
15. Invest because you comprehend the business, not because you like the name or have a connection.
16. Evaluate results across years, not days.
17. Every invested dollar should have a purpose; never invest without understanding why.
18. Develop a clear strategy before committing your money.
19. Compounding is a marvel, but you have to leverage it for it to matter.
20. Speculation isn't investing – it's the price paid by those who rush in without thinking.
Source: investing.com
Saturday, 17 June 2023
Bob Parsons® 16 Rules for Success in Business and Life in General
1. Get and stay out of your comfort zone.
I believe that not much happens of any significance when we're in our comfort zone. I hear people say, "But I'm concerned about security." My response to that is simple: "Security is for cadavers."
2. Never give up.
Almost nothing works the first time it's attempted. Just because what you're doing does not seem to be working, doesn't mean it won't work. It just means that it might not work the way you're doing it. If it was easy, everyone would be doing it, and you wouldn't have an opportunity.
3. When you're ready to quit, you're closer than you think.
There's an old Chinese saying that I just love, and I believe it is so true. It goes like this: "The temptation to quit will be greatest just before you are about to succeed."
4. With regard to whatever worries you, not only accept the worst thing that could happen, but make it a point to quantify what the worst thing could be.Very seldom will the worst consequence be anywhere near as bad as a cloud of "undefined consequences." My father would tell me early on, when I was struggling and losing my shirt trying to get Parsons Technology going, "Well, Robert, if it doesn't work, they can't eat you."
5. Focus on what you want to have happen.
Remember that old saying, "As you think, so shall you be."
6. Take things a day at a time.
No matter how difficult your situation is, you can get through it if you don't look too far into the future, and focus on the present moment. You can get through anything one day at a time.
7. Always be moving forward.
Never stop investing. Never stop improving. Never stop doing something new. The moment you stop improving your organization, it starts to die. Make it your goal to be better each and every day, in some small way. Remember the Japanese concept of Kaizen. Small daily improvements eventually result in huge advantages.
8. Be quick to decide.
Remember what General George S. Patton said: "A good plan violently executed today is far and away better than a perfect plan tomorrow."
9. Measure everything of significance.I swear this is true. Anything that is measured and watched, improves.
10. Anything that is not managed will deteriorate.
If you want to uncover problems you don't know about, take a few moments and look closely at the areas you haven't examined for a while. I guarantee you problems will be there.
11. Pay attention to your competitors, but pay more attention to what you're doing.
When you look at your competitors, remember that everything looks perfect at a distance. Even the planet Earth, if you get far enough into space, looks like a peaceful place.
12. Never let anybody push you around.
In our society, with our laws and even playing field, you have just as much right to what you're doing as anyone else, provided that what you're doing is legal.
13. Never expect life to be fair.
Life isn't fair. You make your own breaks. You'll be doing good if the only meaning fair has to you, is something that you pay when you get on a bus (i.e., fare).
14. Solve your own problems.
You'll find that by coming up with your own solutions, you'll develop a competitive edge. Masura Ibuka, the co-founder of SONY, said it best: "You never succeed in technology, business, or anything by following the others." There's also an old saying that I remind myself of frequently. It goes like this: "A wise man keeps his own counsel."
15. Don't take yourself too seriously.
Lighten up. Often, at least half of what we accomplish is due to luck. None of us are in control as much as we like to think we are.
16. There's always a reason to smile.
Find it. After all, you're really lucky just to be alive. Life is short. More and more, I agree with my little brother. He always reminds me: "We're not here for a long time, we're here for a good time!"
"Copyright © 2004 Bob Parsons - http://www.bobparsons.me. All rights reserved. Reproduced with permission."
I believe that not much happens of any significance when we're in our comfort zone. I hear people say, "But I'm concerned about security." My response to that is simple: "Security is for cadavers."
2. Never give up.
Almost nothing works the first time it's attempted. Just because what you're doing does not seem to be working, doesn't mean it won't work. It just means that it might not work the way you're doing it. If it was easy, everyone would be doing it, and you wouldn't have an opportunity.
3. When you're ready to quit, you're closer than you think.
There's an old Chinese saying that I just love, and I believe it is so true. It goes like this: "The temptation to quit will be greatest just before you are about to succeed."
4. With regard to whatever worries you, not only accept the worst thing that could happen, but make it a point to quantify what the worst thing could be.Very seldom will the worst consequence be anywhere near as bad as a cloud of "undefined consequences." My father would tell me early on, when I was struggling and losing my shirt trying to get Parsons Technology going, "Well, Robert, if it doesn't work, they can't eat you."
5. Focus on what you want to have happen.
Remember that old saying, "As you think, so shall you be."
6. Take things a day at a time.
No matter how difficult your situation is, you can get through it if you don't look too far into the future, and focus on the present moment. You can get through anything one day at a time.
7. Always be moving forward.
Never stop investing. Never stop improving. Never stop doing something new. The moment you stop improving your organization, it starts to die. Make it your goal to be better each and every day, in some small way. Remember the Japanese concept of Kaizen. Small daily improvements eventually result in huge advantages.
8. Be quick to decide.
Remember what General George S. Patton said: "A good plan violently executed today is far and away better than a perfect plan tomorrow."
9. Measure everything of significance.I swear this is true. Anything that is measured and watched, improves.
10. Anything that is not managed will deteriorate.
If you want to uncover problems you don't know about, take a few moments and look closely at the areas you haven't examined for a while. I guarantee you problems will be there.
11. Pay attention to your competitors, but pay more attention to what you're doing.
When you look at your competitors, remember that everything looks perfect at a distance. Even the planet Earth, if you get far enough into space, looks like a peaceful place.
12. Never let anybody push you around.
In our society, with our laws and even playing field, you have just as much right to what you're doing as anyone else, provided that what you're doing is legal.
13. Never expect life to be fair.
Life isn't fair. You make your own breaks. You'll be doing good if the only meaning fair has to you, is something that you pay when you get on a bus (i.e., fare).
14. Solve your own problems.
You'll find that by coming up with your own solutions, you'll develop a competitive edge. Masura Ibuka, the co-founder of SONY, said it best: "You never succeed in technology, business, or anything by following the others." There's also an old saying that I remind myself of frequently. It goes like this: "A wise man keeps his own counsel."
15. Don't take yourself too seriously.
Lighten up. Often, at least half of what we accomplish is due to luck. None of us are in control as much as we like to think we are.
16. There's always a reason to smile.
Find it. After all, you're really lucky just to be alive. Life is short. More and more, I agree with my little brother. He always reminds me: "We're not here for a long time, we're here for a good time!"
"Copyright © 2004 Bob Parsons - http://www.bobparsons.me. All rights reserved. Reproduced with permission."
Saturday, 25 March 2023
How Inflation Ruined The Roman Economy
By Steve Burns
In this blog post, we will delve into the fascinating world of the Roman Empire’s economy and unravel how the phenomenon of inflation played a significant role in its eventual collapse. As someone interested in economics and monetary policy, I will guide you through this intriguing journey. You will learn the specific economic conditions, monetary policy, and societal trends that lead to the demise of one of the greatest civilizations the world has ever seen.
A Brief Overview Of The Roman Empire’s Economy
The Roman Empire’s economy was a complex system that involved trade, agriculture, and various industries. At its peak, the empire was an economic powerhouse, boasting a vast network of trade routes and a plethora of resources. Let’s break down the critical components of this economic behemoth:
Trade
- The Roman Empire was central to a vast trade network, with goods and services flowing from various regions.
- Key trade routes included the Mediterranean Sea and the Silk Road.
- Imported goods ranged from spices and silks to precious metals and exotic animals.
Agriculture
- Agriculture was the backbone of the Roman Empire’s economy, with a majority of the population engaged in farming.
- The empire’s fertile lands produced a variety of crops, including wheat, olives, and grapes.
- The abundance of food allowed the Roman Empire to support its large population and urban centers.
Industries
- The Roman Empire boasted various industries, from mining and metallurgy to pottery and textiles.
- Roman engineering prowess allowed for the construction of large-scale projects, such as aqueducts, roads, monumental buildings, and the Roman Colosseum.
- These industries provided employment opportunities, generated wealth, and fueled economic growth.
With this background in mind, let’s now turn our attention to the role of inflation in the decline of the Roman Empire’s economy.
The Emergence Of Inflation
Inflation, the continuous rise in prices for goods and services, slowly began to creep into the Roman Empire’s economy. As the empire expanded, its monetary policy became increasingly complex, ultimately leading to devastating consequences.
Debasement Of Currency
- The Roman Empire’s primary currency was the silver denarius, widely accepted across the empire and beyond.
- Over time, emperors began to debase the denarius by reducing its silver content to fund wars, public works, and other expenses.
- This debasement decreased the coin’s intrinsic value, resulting in inflation and a decline in purchasing power.
Emperors debased the currency by reducing the precious metal content in the coins, primarily the silver content in the denarius, which was the principal currency of the Roman Empire. This process allowed them to create more coins using the same amount of precious metal, thus increasing the money supply to fund their various expenses, such as wars, public works, and administrative costs.
There were several methods of debasement, including:
- Reducing the coin’s weight: Emperors would order the production of coins with a lower weight, thus using less precious metal for each coin.
- Alloying: Another method involves mixing a precious metal, such as silver or gold, with a less valuable metal, like copper or bronze. This created an alloy with a lower percentage of precious metal content in each coin. The appearance of the coin would remain somewhat similar, but its intrinsic value would be lower due to the reduced amount of precious metal.
- Clipping and shaving: In some cases, metal from the edges of the coins would be clipped or shaved off and then used to produce new coins. This method reduced the weight and value of the existing coins while creating new ones with the collected shavings.
The debasement of currency was a short-term solution for emperors to finance their expenditures, but it had long-term negative consequences. As the currency’s intrinsic value decreased, people began to lose faith in the denarius, leading to inflation, reduced purchasing power, and a decline in trade and commerce. This, in turn, contributed to the overall weakening of the Roman Empire’s economy.
As the debased currency circulated throughout the empire, people started to recognize the decline in its value. This led to a phenomenon known as Gresham’s Law, which states that “bad money drives out good.” In this context, people would hoard the older, more valuable coins with higher precious metal content and spend the debased coins instead. Consequently, the older, more valuable coins would disappear from circulation, leaving the debased currency as the primary medium of exchange.
This hoarding behavior further aggravated the economic situation by decreasing the amount of sound money in circulation, making transactions more complex and promoting barter as an alternative to monetary exchange. As the economy continued to decline, the Roman Empire faced increased social unrest, a widening gap between the rich and poor, and a reduced ability to respond to external threats such as invasions and migrations.
Excessive Government Spending
- The Roman Empire’s expenditures grew as the empire expanded, requiring increased funding for military campaigns, public works, and administrative costs.
- To cover these expenses, the government often resorted to increasing taxes, debasing the currency, or both.
- This practice weakened the empire’s financial position, further exacerbating inflationary pressures.
How Inflation Impacted The Roman Empire’s Economy
The consequences of inflation were far-reaching and detrimental to the overall health of the Roman Empire’s economy.
Let’s examine some of the critical effects:
Erosion Of Wealth
- As inflation took hold, the purchasing power of the denarius decreased, making it difficult for individuals to maintain their wealth and living standards.
- Savings were eroded, and individuals began to hoard precious metals, such as gold and silver, as a means of preserving their wealth.
- This behavior reduced the amount of sound money in circulation, further exacerbating the economic downturn.
A Decline In Trade And Commerce
- As the value of the denarius continued to decline, merchants were less willing to accept it as payment for goods and services.
- This reluctance led to a slowdown in trade and commerce as transactions became more cumbersome and less efficient.
- The decline in trade had a ripple effect on other sectors of the economy, such as agriculture and industry, which also suffered as a result.
Social Unrest And Class Struggles
- The effects of inflation were not evenly distributed across the population, with the lower classes bearing the brunt of the economic hardship.
- The widening gap between the rich and the poor fueled social unrest and exacerbated existing class struggles.
- As discontent grew, it contributed to the overall instability of the empire, making it more susceptible to external threats.
The Final Blow: External Factors And The Fall Of The Roman Empire
While inflation played a significant role in the decline of the Roman Empire’s economy, it was not the sole factor responsible for its eventual collapse. External factors, such as invasions, migrations, and political instability, also played a part in bringing down the once-mighty empire.
Invasions And Migrations
- As the Roman Empire’s economy weakened, it became increasingly vulnerable to invasions from barbarian tribes, such as the Visigoths, Vandals, and Huns.
- These invasions not only disrupted trade and commerce but also placed additional strain on the empire’s already fragile economy.
- The influx of migrants and refugees from conquered territories further strained the empire’s resources and infrastructure.
Political Instability And Corruption
- The Roman Empire’s political landscape was marred by frequent power struggles, assassinations, and corruption.
- This instability made it difficult for the empire to implement effective economic policies and address the growing inflation problem.
- The internal turmoil ultimately weakened the empire’s ability to respond to external threats and control its vast territories.
Lessons From The Roman Empire’s Economic Collapse
The fall of the Roman Empire is a cautionary tale for modern societies, illustrating the dangers of unchecked inflation and the importance of sound monetary policy. Some key takeaways from this historical episode include:
- The importance of maintaining a stable currency to ensure economic stability and growth.
- The need for governments to exercise fiscal responsibility and avoid excessive spending and debt accumulation.
- The value of addressing economic disparities and promoting social cohesion to maintain a stable and united society.
Key Lessons
The Roman Empire’s economy, once a marvel of the ancient world, was brought to its knees by the insidious effects of inflation. The debasement of the currency, excessive government spending, and many external factors combined to create a perfect storm that led to the empire’s downfall. By studying this pivotal moment in history, we can better understand the factors that contribute to economic decline and work to prevent similar catastrophes in the future.
Source: www. newtraderu.com
Saturday, 11 March 2023
20 Lessons From The Psychology Of Money That Will Change How You Think About Money
By Steve Burns
If you want to achieve financial success, it’s super important to understand the psychology of money. Money isn’t just a physical thing; it’s got emotional and psychological implications too. How we think about money affects our financial decisions, which can significantly impact our lives.
There’s an excellent book called “The Psychology of Money” by Morgan Housel that can help change your perspective on finances. In this article, we’ll talk about 20 lessons from the book that can help you understand money better and make smarter financial choices.
Lesson 1: Our Worldview Is Limited
What we experience is just a tiny part of what’s happening worldwide. But it shapes how we see things 80% of the time. This is especially true regarding money because our experiences shape our attitudes and beliefs. If we recognize that our experiences are limited, we can be more open to new ideas and perspectives.
Lesson 2: Luck Vs. Risk
Knowing the difference between luck and risk is essential when making financial decisions. Sometimes, bad luck can mess up a good decision, and sometimes, good luck can make a wrong decision look good. Understanding the difference between luck and risk can help you make better decisions and avoid unnecessary risks.
Lesson 3: Knowing When Enough Is Enough
Most of us have enough to live on, but we always want more. We should recognize when we have enough and be content with it. It doesn’t mean we shouldn’t try to improve our financial situation, but we should be mindful of our priorities and avoid unnecessary stress and anxiety.
Lesson 4: Don’t Risk What’s Important
Things like our reputation, freedom, family, friends, and happiness are never worth risking. Money can be a motivator, but we should always consider the consequences of our actions and avoid taking unnecessary risks that could harm our personal and professional lives.
Lesson 5: The Magic Of Compound Interest
Compound interest can be a powerful tool when used correctly. You can create wealth by putting money into low-cost index funds over time. This takes patience and discipline but can lead to significant financial gains.
Lesson 6: Plan For The Worst
Having emergency funds and planning for the worst is essential. Setting aside six months to a year’s living expenses can help weather any storm. This can also give you peace of mind and reduce financial uncertainty.
Lesson 7: Take Control Of Your Finances
Taking control of your finances, you are in charge of your financial destiny. You should do what’s right for you, even if everyone else does something different. This means avoiding trends and focusing on long-term goals and strategies.
Lesson 8: Freedom Is Key
Building freedom in your life is essential. Even if you love your job, you should focus on building freedom because things can change quickly. This means saving money, investing in your education, and building a safety net that can help you weather any storm.
Lesson 9: Nobody Cares About Your Stuff
We often think material things will impress others, but no one cares. It’s liberating to realize that we don’t need to impress anyone. Instead, we should focus on what truly matters, like our relationships, health, and personal growth.
Lesson 10: Be Wealthy, Not Flashy
True wealth is measured by freedom, not how much money you spend. You should focus on building wealth to live life on your terms.
Lesson 11: The Importance Of Time
Time is one of the most valuable things we have. The earlier we start saving and investing, the more time we have to grow our wealth. Don’t waste time procrastinating or making excuses. Start now, even if it’s just a little bit.
Lesson 12: Understand Your Biases
We all have biases that can affect our financial decisions. Recognizing these biases and working to overcome them can help us make better choices.
Lesson 13: Money Is A Means To An End
Money is just a tool to help us achieve our goals. It’s not the end goal in itself. Focus on what you want and use the money to get there.
Lesson 14: It’s Not About Timing The Market
Trying to predict the market is a losing game. Instead, focus on profitable long-term investment strategies and avoid getting caught up emotionally in short-term market fluctuations.
Lesson 15: Don’t Follow The Herd
Just because everyone else is doing something doesn’t mean it’s right for you. Avoid the herd mentality and make financial decisions based on your goals and values.
Lesson 16: The Value Of Simplicity
Simple financial strategies are often the most effective. Avoid overly complicated investments or strategies that are difficult to understand.
Lesson 17: Make Peace With Risk
Risk is a natural part of investing. Instead of avoiding it, learn to manage and accept it. Don’t let fear of risk prevent you from achieving your financial goals.
Lesson 18: Invest In Yourself
Investing in yourself, whether it’s through education, personal development, or health, is one of the best investments you can make. The returns on self-investment can be substantial and long-lasting.
Lesson 19: Learn From Mistakes
We all make mistakes, but the key is to learn from them. Analyze your financial mistakes and use them as a learning opportunity to make better decisions in the future.
Lesson 20: Stay Humble
No matter how successful you become, always stay humble. Be grateful for what you have; remember, there’s always more to learn. Financial success should never come at the expense of your values or character.
Conclusion
Understanding the psychology of money is essential for achieving financial freedom and making intelligent financial decisions. The lessons from “The Psychology of Money” is powerful for anyone interested in personal finance and investing. Morgan Housel has an enjoyable writing style and provides valuable insights into how we think about money and how it can affect our lives. By recognizing our biases, avoiding unnecessary risks, staying disciplined, and focusing on our long-term goals, we can build wealth and achieve financial security. It’s important to remember that money is a means to an end, and that true wealth is measured by the freedom to live on our terms. With patience, discipline, and a willingness to learn, anyone can achieve financial success and build a secure future for themselves and their loved ones.
If you want to achieve financial success, it’s super important to understand the psychology of money. Money isn’t just a physical thing; it’s got emotional and psychological implications too. How we think about money affects our financial decisions, which can significantly impact our lives.
There’s an excellent book called “The Psychology of Money” by Morgan Housel that can help change your perspective on finances. In this article, we’ll talk about 20 lessons from the book that can help you understand money better and make smarter financial choices.
Lesson 1: Our Worldview Is Limited
What we experience is just a tiny part of what’s happening worldwide. But it shapes how we see things 80% of the time. This is especially true regarding money because our experiences shape our attitudes and beliefs. If we recognize that our experiences are limited, we can be more open to new ideas and perspectives.
Lesson 2: Luck Vs. Risk
Knowing the difference between luck and risk is essential when making financial decisions. Sometimes, bad luck can mess up a good decision, and sometimes, good luck can make a wrong decision look good. Understanding the difference between luck and risk can help you make better decisions and avoid unnecessary risks.
Lesson 3: Knowing When Enough Is Enough
Most of us have enough to live on, but we always want more. We should recognize when we have enough and be content with it. It doesn’t mean we shouldn’t try to improve our financial situation, but we should be mindful of our priorities and avoid unnecessary stress and anxiety.
Lesson 4: Don’t Risk What’s Important
Things like our reputation, freedom, family, friends, and happiness are never worth risking. Money can be a motivator, but we should always consider the consequences of our actions and avoid taking unnecessary risks that could harm our personal and professional lives.
Lesson 5: The Magic Of Compound Interest
Compound interest can be a powerful tool when used correctly. You can create wealth by putting money into low-cost index funds over time. This takes patience and discipline but can lead to significant financial gains.
Lesson 6: Plan For The Worst
Having emergency funds and planning for the worst is essential. Setting aside six months to a year’s living expenses can help weather any storm. This can also give you peace of mind and reduce financial uncertainty.
Lesson 7: Take Control Of Your Finances
Taking control of your finances, you are in charge of your financial destiny. You should do what’s right for you, even if everyone else does something different. This means avoiding trends and focusing on long-term goals and strategies.
Lesson 8: Freedom Is Key
Building freedom in your life is essential. Even if you love your job, you should focus on building freedom because things can change quickly. This means saving money, investing in your education, and building a safety net that can help you weather any storm.
Lesson 9: Nobody Cares About Your Stuff
We often think material things will impress others, but no one cares. It’s liberating to realize that we don’t need to impress anyone. Instead, we should focus on what truly matters, like our relationships, health, and personal growth.
Lesson 10: Be Wealthy, Not Flashy
True wealth is measured by freedom, not how much money you spend. You should focus on building wealth to live life on your terms.
Lesson 11: The Importance Of Time
Time is one of the most valuable things we have. The earlier we start saving and investing, the more time we have to grow our wealth. Don’t waste time procrastinating or making excuses. Start now, even if it’s just a little bit.
Lesson 12: Understand Your Biases
We all have biases that can affect our financial decisions. Recognizing these biases and working to overcome them can help us make better choices.
Lesson 13: Money Is A Means To An End
Money is just a tool to help us achieve our goals. It’s not the end goal in itself. Focus on what you want and use the money to get there.
Lesson 14: It’s Not About Timing The Market
Trying to predict the market is a losing game. Instead, focus on profitable long-term investment strategies and avoid getting caught up emotionally in short-term market fluctuations.
Lesson 15: Don’t Follow The Herd
Just because everyone else is doing something doesn’t mean it’s right for you. Avoid the herd mentality and make financial decisions based on your goals and values.
Lesson 16: The Value Of Simplicity
Simple financial strategies are often the most effective. Avoid overly complicated investments or strategies that are difficult to understand.
Lesson 17: Make Peace With Risk
Risk is a natural part of investing. Instead of avoiding it, learn to manage and accept it. Don’t let fear of risk prevent you from achieving your financial goals.
Lesson 18: Invest In Yourself
Investing in yourself, whether it’s through education, personal development, or health, is one of the best investments you can make. The returns on self-investment can be substantial and long-lasting.
Lesson 19: Learn From Mistakes
We all make mistakes, but the key is to learn from them. Analyze your financial mistakes and use them as a learning opportunity to make better decisions in the future.
Lesson 20: Stay Humble
No matter how successful you become, always stay humble. Be grateful for what you have; remember, there’s always more to learn. Financial success should never come at the expense of your values or character.
Conclusion
Understanding the psychology of money is essential for achieving financial freedom and making intelligent financial decisions. The lessons from “The Psychology of Money” is powerful for anyone interested in personal finance and investing. Morgan Housel has an enjoyable writing style and provides valuable insights into how we think about money and how it can affect our lives. By recognizing our biases, avoiding unnecessary risks, staying disciplined, and focusing on our long-term goals, we can build wealth and achieve financial security. It’s important to remember that money is a means to an end, and that true wealth is measured by the freedom to live on our terms. With patience, discipline, and a willingness to learn, anyone can achieve financial success and build a secure future for themselves and their loved ones.
Source: www.newtraderu.com
Wednesday, 21 December 2022
16 Habits of Mind
By Steve Burns
The 16 Habits of Mind are a framework for how to think and behave intelligently when problems are encountered and challenges are faced in life for learning and growing. These habits were discovered by the research of authors Costa and Kallick and primarily studied in educational environments. These habits were quantified by drawing on their research and experience in applying the habits of mind to achieve results in education but can be implemented in any area of life like business, sports, and family life. These mind habits are the keys to the mental behaviors for every step in making intelligent behavior a practical outcome in any situation or pursuit in life.
What are mind habits?
Habits of Mind are repetitive thinking patterns that intelligent people use to solve problems they encounter. They use different mental models from their mental toolbox like logic, social intelligence, emotional intelligence, and experience. The best mental habits create heuristic shortcuts to allow smart people to act in effective ways when encountering difficult problems.
What are the critical Habits of Mind?
Below are the 16 Habits of Mind identified by Costa and Kallick in their book Learning and Leading with Habits of Mind: 16 Essential Characteristics for Success
1. Persistence
Not giving up is a powerful habit as perseverance can overcome the obstacles of time and inexperience.
3. Managing impulsiveness
The ability to say no to your own impulses and desires in the short-term to achieve more desired long-term goals is one of the most important mental habits for success in any area of life. Waiting, patience, and self-discipline can pay large future returns.
4. Use all senses to gather data
Complete observation is the process of using all of your five senses to gather all available information. This means allowing information into our brains from as many senses as possible and not just a few.
Being mindful of all our sensory pathways can make us more open and alert to absorbing more information from a situation than those who don’t realize how to use their full senses. Studies are learning more about the impact of art and music on improved mental functioning. Forming clear mental images is essential in math and engineering. Other professional fields use a variety of senses to improve their work. The wider the perspective we can get in a situation from the most senses the more we will understand the different angles of a problem.
5. Social Intelligence
Listening with understanding and empathy is a form intelligence practiced in social settings. Social intelligence is a crucial mental habit that will open up networking and relationships to your life that can help exponentially in all areas of achievement and happiness in general.
6. Creativity
Creating, imagining, and innovating is a mental edge as so many people just do what they’re told and manage what already exists for them. Creating new things is one of the most powerful mental habits you can develop.
7. Flexible thinking
Thinking flexibly helps react to situations as they unfold and adapt to best take advantage of opportunities. A flexible thinker always adjusts to change and looks for the best new pathway for success.
8. Enthusiastic responses
Responding with wonderment and awe makes people feel special and important. How we react to others sets their tone for how they feel about us and how willing they are to help us in anything we need.
9. Metacognition
Thinking about thinking is having the awareness and understanding of your own thought processes. Metacognition is the mental habit of knowing yourself, being mindful of your thoughts as they play out. It’s the practice of mindfulness or being aware of your own biases, strengths, and weaknesses. This is one of the most powerful mental habits as it gives you the higher perspective of self-awareness.
14. Seeing confluences
Thinking interdependently on how things work together is the mental habit of seeing the big picture. This mental habit of seeing confluences can see underlying risks and unintended consequences as well as how to create big wins be combining things that are not obviously related.
15. Using experience
Applying past knowledge to new situations. The mental habit of using experience for learning lessons and not making the same mistake multiple times. Using old lessons to solve new problems. Don’t work the same year over and over again, each new year of experience should see growth and improvement not repeating patterns of mistakes.
16. Life-long learner
Remaining open to continuous learning is a crucial mental habit with the current rate of change in education, business, and technology. If you’re not learning and growing as an individual you are being left behind in a fast changing world.
The 16 Habits of Mind are a framework for how to think and behave intelligently when problems are encountered and challenges are faced in life for learning and growing. These habits were discovered by the research of authors Costa and Kallick and primarily studied in educational environments. These habits were quantified by drawing on their research and experience in applying the habits of mind to achieve results in education but can be implemented in any area of life like business, sports, and family life. These mind habits are the keys to the mental behaviors for every step in making intelligent behavior a practical outcome in any situation or pursuit in life.
What are mind habits?
Habits of Mind are repetitive thinking patterns that intelligent people use to solve problems they encounter. They use different mental models from their mental toolbox like logic, social intelligence, emotional intelligence, and experience. The best mental habits create heuristic shortcuts to allow smart people to act in effective ways when encountering difficult problems.
What are the critical Habits of Mind?
Below are the 16 Habits of Mind identified by Costa and Kallick in their book Learning and Leading with Habits of Mind: 16 Essential Characteristics for Success
1. Persistence
Not giving up is a powerful habit as perseverance can overcome the obstacles of time and inexperience.
2. Thoughtful communication
Clear and precise communication and thinking can be life changing. The key to communication is making sure you know what your audience needs to hear to understand based on their own perspective. Most of the best communication is in the listening and then the focus on just saying the minimum needed to get your point across. Telling people what you need from them is also crucial. It’s a skill to think clearly using logic and reason and not letting your emotions, opinions, and ego cloud your thinking.
Clear and precise communication and thinking can be life changing. The key to communication is making sure you know what your audience needs to hear to understand based on their own perspective. Most of the best communication is in the listening and then the focus on just saying the minimum needed to get your point across. Telling people what you need from them is also crucial. It’s a skill to think clearly using logic and reason and not letting your emotions, opinions, and ego cloud your thinking.
3. Managing impulsiveness
The ability to say no to your own impulses and desires in the short-term to achieve more desired long-term goals is one of the most important mental habits for success in any area of life. Waiting, patience, and self-discipline can pay large future returns.
4. Use all senses to gather data
Complete observation is the process of using all of your five senses to gather all available information. This means allowing information into our brains from as many senses as possible and not just a few.
Being mindful of all our sensory pathways can make us more open and alert to absorbing more information from a situation than those who don’t realize how to use their full senses. Studies are learning more about the impact of art and music on improved mental functioning. Forming clear mental images is essential in math and engineering. Other professional fields use a variety of senses to improve their work. The wider the perspective we can get in a situation from the most senses the more we will understand the different angles of a problem.
5. Social Intelligence
Listening with understanding and empathy is a form intelligence practiced in social settings. Social intelligence is a crucial mental habit that will open up networking and relationships to your life that can help exponentially in all areas of achievement and happiness in general.
6. Creativity
Creating, imagining, and innovating is a mental edge as so many people just do what they’re told and manage what already exists for them. Creating new things is one of the most powerful mental habits you can develop.
7. Flexible thinking
Thinking flexibly helps react to situations as they unfold and adapt to best take advantage of opportunities. A flexible thinker always adjusts to change and looks for the best new pathway for success.
8. Enthusiastic responses
Responding with wonderment and awe makes people feel special and important. How we react to others sets their tone for how they feel about us and how willing they are to help us in anything we need.
9. Metacognition
Thinking about thinking is having the awareness and understanding of your own thought processes. Metacognition is the mental habit of knowing yourself, being mindful of your thoughts as they play out. It’s the practice of mindfulness or being aware of your own biases, strengths, and weaknesses. This is one of the most powerful mental habits as it gives you the higher perspective of self-awareness.
10. Risk Management
Taking responsible risks is a crucial mental habit to stay safe mentally, emotionally, and financially. It allows learning and growing to be safely done in the context of a risk management framework.
Taking responsible risks is a crucial mental habit to stay safe mentally, emotionally, and financially. It allows learning and growing to be safely done in the context of a risk management framework.
11. Precision in action
Striving for accuracy is a mental skill that helps focus effort, energy, and time for optimal results.
Striving for accuracy is a mental skill that helps focus effort, energy, and time for optimal results.
12. Humor
Finding humor is a mental skill for both stress reduction for yourself and others.
Finding humor is a mental skill for both stress reduction for yourself and others.
13. Thinking in possibilities
Questioning and posing problems helps see all possible outcomes both good and bad. This can help establish good risk/reward ratios and see the best and worst cash scenarios before committing to one path of action.
Questioning and posing problems helps see all possible outcomes both good and bad. This can help establish good risk/reward ratios and see the best and worst cash scenarios before committing to one path of action.
14. Seeing confluences
Thinking interdependently on how things work together is the mental habit of seeing the big picture. This mental habit of seeing confluences can see underlying risks and unintended consequences as well as how to create big wins be combining things that are not obviously related.
15. Using experience
Applying past knowledge to new situations. The mental habit of using experience for learning lessons and not making the same mistake multiple times. Using old lessons to solve new problems. Don’t work the same year over and over again, each new year of experience should see growth and improvement not repeating patterns of mistakes.
16. Life-long learner
Remaining open to continuous learning is a crucial mental habit with the current rate of change in education, business, and technology. If you’re not learning and growing as an individual you are being left behind in a fast changing world.
Why are the Habits of Mind important?
Using the Habits of Mind allows people to continue to optimize positive experiences and overcome negative experiences and continue to learn even when needing to guess or making mistakes. When we use the Habits of Mind we can realize that when a mind is reaching for new information and making connections for problem solving we learn during the process of arriving at conclusions for what to do.
The key to getting the maximum value from the Habits of the Mind is to make them your natural default thought filter through continuously using them in place of emotional reactions or letting ego interfere with the decision making process. Repetition is the key to developing habits.
Using the Habits of Mind allows people to continue to optimize positive experiences and overcome negative experiences and continue to learn even when needing to guess or making mistakes. When we use the Habits of Mind we can realize that when a mind is reaching for new information and making connections for problem solving we learn during the process of arriving at conclusions for what to do.
The key to getting the maximum value from the Habits of the Mind is to make them your natural default thought filter through continuously using them in place of emotional reactions or letting ego interfere with the decision making process. Repetition is the key to developing habits.
Source: www.newtraderu.com
Friday, 12 August 2022
The 80/20 Rule or the Pareto Principle - How it can change your life?
Have you ever wondered something? That some of your mates or even your business partners do a little and get a lot in return. Well, is that black magic? It might not be because a scientific method which is known as the Pareto’s principle or 80/20 Rule is here to explain the whole deal to you.
Understanding the knowledge of the 80/20 principle
The 80/20 is sometimes known as the Pareto principle. This was originally an observation made by Vilfredo Pareto that around 80 percent of the world’s wealth is only owned by 20 percent of the population. We are not here to discuss economics right. We are here to decipher the whole trick and help you to prepare for your life scores in the best possible way needed.
There are some simple tricks that you need to apply to your Life because mugging up won’t do you any good. Living smart is the option right now, and with that comes the need for your presence of mind. Successful people who know how to advance their Lives already have learned the 80/20 rule. It always helps them to prepare life exams and to ace the results later.
While it does not seem like it is the precisely 80/20 rule which works here, these imbalances are seen in your Life and often in other cases as well.
To this day, the 80/20 rule applies in real Lifelike:
How does it work?
One of the best mental models that you can get around for yourself is the 80/20 or the Pareto principle. You can basically apply it in your daily life, and it helps you with a lot of things that you want to improve in. Like if you wish to have better learning skills, use this principle to do better. This can also be used by people who want to analyze better ideas for their business and else.
Well, the 80/20 rule is used to improve everything in a well-systematized way.
If you are a typical analyst of Life, then what do you do? You spend half of the time into sulking the fact that why you are not getting your dream job or doing productive work in a single day. Your version of living Life is wasted onto the thoughts that you put inside it. Pareto’s principle is the mental model you can use.
You need to understand where your focus lies and make sure that it sticks to it. You need to have a core and basic understanding of your surroundings. Here, you cannot dive into the growth of the process. You have to get the pieces together, and only then you can dive into the success of Life. By putting the right type of focus on the work that you do, you will be changing your Life for the best. It will help you to get a charge on your Life.
Understanding the knowledge of the 80/20 principle
The 80/20 is sometimes known as the Pareto principle. This was originally an observation made by Vilfredo Pareto that around 80 percent of the world’s wealth is only owned by 20 percent of the population. We are not here to discuss economics right. We are here to decipher the whole trick and help you to prepare for your life scores in the best possible way needed.
There are some simple tricks that you need to apply to your Life because mugging up won’t do you any good. Living smart is the option right now, and with that comes the need for your presence of mind. Successful people who know how to advance their Lives already have learned the 80/20 rule. It always helps them to prepare life exams and to ace the results later.
While it does not seem like it is the precisely 80/20 rule which works here, these imbalances are seen in your Life and often in other cases as well.
To this day, the 80/20 rule applies in real Lifelike:
Most of the time, you will see that only 20 percent of the people have the riches of the world, and 80 percent have half of it. This might seem unfair but it is how it is.
In your exam time, you can see that students who only study about as little as they want, they will get 80 percent of the marks. The rest of them will attain lower grades.
In your business analytics, the managers or the workers who only spent less time of their work into the business then they are obtaining 80 percent of the incentives. The 20 percent is attained for the lower part of your motivation.
The 80/20 Rule to advance your Life
You might be wondering what the 80/20 rule is so here we will cover it for you. For instance, living with a limited amount of resources for a day can be hard for you. Under final observation, it is seen that different people have a distinct style of coping, and that is how the whole factor is determined.
Studies have seen that people who have only put 20 percent of their effort have scored above 80 percent of the results towards their achieved goals.
You might be thinking that how it really happens but well, there is a trick to it. Don’t apply if you don’t know the entire rule. The beauty of the 80/20 rule is that it works for you, and it is quite simple to understand as well. Even you can turn around your life in just a single way if you are using this strategy. If your friend is struggling and always finding it hard to cope better with their Life, then you can recommend this to him/her as well.
You might be wondering what the 80/20 rule is so here we will cover it for you. For instance, living with a limited amount of resources for a day can be hard for you. Under final observation, it is seen that different people have a distinct style of coping, and that is how the whole factor is determined.
Studies have seen that people who have only put 20 percent of their effort have scored above 80 percent of the results towards their achieved goals.
You might be thinking that how it really happens but well, there is a trick to it. Don’t apply if you don’t know the entire rule. The beauty of the 80/20 rule is that it works for you, and it is quite simple to understand as well. Even you can turn around your life in just a single way if you are using this strategy. If your friend is struggling and always finding it hard to cope better with their Life, then you can recommend this to him/her as well.
How does it work?
One of the best mental models that you can get around for yourself is the 80/20 or the Pareto principle. You can basically apply it in your daily life, and it helps you with a lot of things that you want to improve in. Like if you wish to have better learning skills, use this principle to do better. This can also be used by people who want to analyze better ideas for their business and else.
Well, the 80/20 rule is used to improve everything in a well-systematized way.
If you are a typical analyst of Life, then what do you do? You spend half of the time into sulking the fact that why you are not getting your dream job or doing productive work in a single day. Your version of living Life is wasted onto the thoughts that you put inside it. Pareto’s principle is the mental model you can use.
You need to understand where your focus lies and make sure that it sticks to it. You need to have a core and basic understanding of your surroundings. Here, you cannot dive into the growth of the process. You have to get the pieces together, and only then you can dive into the success of Life. By putting the right type of focus on the work that you do, you will be changing your Life for the best. It will help you to get a charge on your Life.
Using the 80/20 rule for your benefit
Well, according to the Pareto principle, you need to devote a few hours of your time and focus on the thing that you want in your life.
The rest of the time which you waste should be accounted for a minimum part. It is only for a smaller potent. This does not usually happen to the majority of the people out there. They will take their time to understand and then focus on their Life. Here is something you can look out for.
Well, according to the Pareto principle, you need to devote a few hours of your time and focus on the thing that you want in your life.
The rest of the time which you waste should be accounted for a minimum part. It is only for a smaller potent. This does not usually happen to the majority of the people out there. They will take their time to understand and then focus on their Life. Here is something you can look out for.
- Make sure that you only spend 20 percent of the time in understanding your goal. Understand that the 80 percent is meant for you to persuade it.
- When you are wasting your time, waste only for 20 percent, rest, use it for your source.
- Eighty percent of your time is spent on the mindless hunting of better apps and fiddling with your phone.
- Use the 80 percent of your time into collecting the information you need to change your Life. The best hack lies here.
Prepare for the best
These preparation strategies are here to improve the potency of your Life and advance the options. Using Pareto’s principle will help you to find the best meaning to Life. Always understand that keeping the priorities ahead of you will help you to land somewhere in Life.
Source: www.tradebrains.in
These preparation strategies are here to improve the potency of your Life and advance the options. Using Pareto’s principle will help you to find the best meaning to Life. Always understand that keeping the priorities ahead of you will help you to land somewhere in Life.
Source: www.tradebrains.in
Saturday, 6 August 2022
Hagakure: Trade Like A Samurai
By Steve Burns
The Hagakure: The Book of The Samurai records Yamamoto Tsunetomo’s views on bushido and the warrior code of the samurai. It was written in the early 18th century and explains many principles of the Samurai warrior. Many of these same principles can be used in business, sports, trading, and investing to achieve a warrior mindset and overcome your ego and emotions along with your adversaries.
Bushido Code
The Bushido was a code of conduct for the Samurai consisting of 8 core principles.
Trading Like A Samurai
Doing the right thing: If you have your own system, method, and process with an edge over the competition then if you follow it you should be free of guilt and regret. Knowing you are doing the right thing is a powerful psychological tactic that frees your energy and creates single-mindedness and focus of action.
Confidence in yourself and your strategy: You can take immediate action to follow your strategy when you have faith in yourself and your process. Faith in action leads to less stress when facing unknown future events.
Positive self talk: We must be a friend to ourself with internal self talk. Our own inner dialogue and thoughts should be positive and like that of a friend and coach not an enemy.
Self respect: We must appreciate our past successes and have confidence in our path and future goals. We should never talk negatively about ourself to others. Right action and effort creates self respect, laziness and wrong action hurts it.
Know yourself: Be whole and undivided in who you are and what you believe. Ensure your actions match your words and beliefs.
Honor: Samurai were warriors with a sense of self worth and lived by the highest code of behavior and conduct. To abide by the principle of honor, we must acknowledge your moral responsibilities for taking actions consistent with or systems and beliefs.
Doing the work consistently: We choose the method we will focus our work and effort on at the beginning of our journey. Then our path consists of executing loyally to our goals.
Managing emotions, desires, and ego: The ability to use your mind and your principles to override feelings, wants, and arrogance is true power. A true samurai first defeats their self before facing any external enemy.
Bushido Code
The Bushido was a code of conduct for the Samurai consisting of 8 core principles.
- Righteousness
- Heroic Courage
- Benevolence & Compassion
- Respect
- Integrity
- Honor
- Duty & Loyalty
- Self-Control
Trading Like A Samurai
Doing the right thing: If you have your own system, method, and process with an edge over the competition then if you follow it you should be free of guilt and regret. Knowing you are doing the right thing is a powerful psychological tactic that frees your energy and creates single-mindedness and focus of action.
Confidence in yourself and your strategy: You can take immediate action to follow your strategy when you have faith in yourself and your process. Faith in action leads to less stress when facing unknown future events.
Positive self talk: We must be a friend to ourself with internal self talk. Our own inner dialogue and thoughts should be positive and like that of a friend and coach not an enemy.
Self respect: We must appreciate our past successes and have confidence in our path and future goals. We should never talk negatively about ourself to others. Right action and effort creates self respect, laziness and wrong action hurts it.
Know yourself: Be whole and undivided in who you are and what you believe. Ensure your actions match your words and beliefs.
Honor: Samurai were warriors with a sense of self worth and lived by the highest code of behavior and conduct. To abide by the principle of honor, we must acknowledge your moral responsibilities for taking actions consistent with or systems and beliefs.
Doing the work consistently: We choose the method we will focus our work and effort on at the beginning of our journey. Then our path consists of executing loyally to our goals.
Managing emotions, desires, and ego: The ability to use your mind and your principles to override feelings, wants, and arrogance is true power. A true samurai first defeats their self before facing any external enemy.
Source:www.newtraderu.com
Sunday, 1 May 2022
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