Courage is at the core of every great investor and genuine courage is rare.
Every market climate tests our investment conviction, today's environment is especially intimidating.
For an investor, challenging popular thought is never easy, but the fact is a number of solid companies with good fundamentals lie in the market wreckage.
Greed blinds us to danger while fear blinds us to new opportunities.
This occurs when logic loses out to emotion.
It is one of the principle reasons why it is so hard for investors to buy low and sell high.
Often, even when individuals plan strategically, they deviate from their plan when the market is too challenging or too tempting.
The elements of Investment Discipline:
- Don't chase performance - it can be hazardous to your wealth!
- Act Strategically, not emotionally. Build an investment plan
- Rebalance your portfolio regularly
- Stick to your plan even when your emotions tell you to do the opposite
- Seek experts when you do not have the tools, the time, or the experience to do it yourself.
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