You
must be wondering why give any importance to personal characteristics when you
ultimately just need to pick a good stock and profits will shower upon you
soon.Well, there are some important traits that you must have in order to be
successful investor:
1)
Patience
The
most important quality one should have is to have lot of patience. Yes 1000
litres of patience or more(just kidding) .Sometimes high potential stock will
do nothing for months and sometimes nothing for a year or so.Yes!! Absolutely
nothing for a year!! 0% returns in an year :) .Many people sell their holdings
if a stock does not give them any return in a month then who would wait for an
year to keep the stock that has given them 0% returns?. I am sure 95% of
investors will sell within an year since they are frustrated with no returns.
What needs to be
done - Sometimes
stock is not researched by many people and hence remains undervalued for many months.
If the company has greater value than what is being reflected in its current
stock price then believe me , someday stock will rise to its true price. So the
most important thing is to identify fair value of a stock and very soon the
stock will reach to your desired level.
2)
Bear the pain
Whenever
the stock goes down from their buy price people start to panic and they make
emotional decision regarding their holdings. They will sell all or buy at lower
levels to average their holdings. But this is not the right thing to do. One
should again analyse and determine fair value of the company and then arrive at
a conclusion and based on that they should take their decisions.
3)
Be focused
"The
men who have succeeded are men who have chosen one line and stuck to it."
-- Andrew Carnegie
Successful
investors are focused on their investment vehicle. They take it one step at a
time; one investment at a time. If you are a long term investor stay like that
and don’t trade much.
4)
Successful investors use trend to
their advantage
"Your
greatest and most powerful business survival strategy is going to be the speed
at which you handle the speed of change. That speed of change is trend." -- Ajaero Tony Martins
Successful
investors use trends such as market sentiments, political instability and
company's crisis to their advantage. Average investors panic over market
fluctuations but professional investors welcome these fluctuations because they
can use these fluctuations to their advantage.
5)
Successful investors are passionate
about investing
If
you take a look at average investors, they are always after how much they are
going to make now but successful investors use delayed gratification and
compounding to gain an edge.
"Wealth
is only a benefit of the game of money. If you win, the money will be
there." -- J. Paul Getty
6)
Be persistent and don’t keep looking
for next hot tip
"When
everything seems to be going against you, remember that the airplane takes off
against the wind, not with it." -- Henry Ford
Sticking
to your investing strategy whether you are winning or losing requires a great
deal of persistence. Average investors lack persistence and that's why they
will forever remain average. They jump from one strategy to another and are
always looking for the next hot tip.
"Most
people give up just when they are about to achieve success. They quit on one
yard line. They give up the at last minute of the game one foot from a winning
touch down." -- Henry Ross Perot
