Recently saw a list of 14 Things Every Wine Student Should Know. Decided to adapt it…
11 Things Every Investor Should Know
- The answer to most questions you have starts with “it depends”.
- There are no sure things.
- Get comfortable with uncertainty.
- Forget about what you “like”. It will not help you learn about or understand investing.
- Upside/Downside capture, Alpha, Beta do not matter. Goals and time horizon do. This is one thing about investing I will say definitively.
- Do not for a second believe that being talked down to by an “advisor” who you think knows a lot is appropriate or normal. The best people in any field do not do this.
- Nothing can do more damage to your portfolio than fear and greed.
- Don’t get carried away or too focused on the daily moves of the stock market. Sure, it’s hard not to look sometimes, but see #9.
- Your goal should not exclusively be to outperform the market. Keep in mind, however, that many great investors are not just great stock pickers. There’s a lot more to investing success than just picking the right stock.
- Always consider what the economic motives of the “advisor” might be.
- Popular investment ideas are not always good investment ideas. This does not mean they are always bad either. Flies are attracted to honey, but they are also attracted to s**t.