Most people tend to think that they are investor material, I mean how can you not want to just go about life investing and making your money work for you? But the truth is that not everyone is investor material. Why? Because in as much as investing has great returns it could have great losses as well. In this article, I get to list the characteristics of most investors, see how many you fit in to. And you can decide for yourself if you are an investor or you need to start looking elsewhere for that retirement plan.
Why are you investing? What is the end goal? You need to have all these clear in your head or more preferably written down before you even begin to have the idea of investing. Where are you getting your finances from? You need to be able to get your finances in order and have contingencies in place. All these to make sure that you have a plan. Just in case things go south. You are not left stranded with nothing to show for it.
Ability to See the Bigger Picture
This is one rare trait to find, but very invaluable for a future investor. Why? If you are able to look at anything and see it’s potential, you can invest in it and with a little time, you will be able to see it come into what you had already envisioned for it. Just imagine, the people who saw the potential in Facebook, Amazon, Google, Uber, Netflix and invested then, where are they now? Their investment was able to bring them such a huge return than they could have imagined. But they saw the potential in the thing they were investing in, and can now enjoy the returns. This is a big one my lovelies.
Always research the thing you want to invest in. It could be your next big break. It could be your biggest downfall. Either of these routes is one that you could end up in, based on your research skills. How well do you do your research? Do you dive in deep and look for all the loopholes and stumbling blocks that could fall your way and try to find solutions, in the event that they may happen? Or do you just ask a few friends how that investment is and based on their responses you make the investment? If you want to become a great investor, invest in research.
The thing about investment, to be successful at it you need to stick to one thing at a time, until it picks then you can move onto the next one. The best thing is after you have done your very detailed research, you can dive into a niche and start investing in it. You need to stay committed to it, in that you cannot deviate from it and start thinking about other things.
You need to follow it diligently. Make sure that you made a good investment. Be obsessed with it. You cannot afford to waiver in your commitment to your investment. It is basically your sweat and blood, your money that you have poured into it, so you have to follow it through until it gives you your desired returns. If commitment is an issue for you… Trouble awaits.
In as much as you are committed to your investment, it is something that could take time. You need to have the patience to let your investment work its magic. Otherwise, if you are too impatient, you could be giving up on something that had the potential to give you so much more in returns. Take the example of stocks, you need to give it time to grow and turn into profitable dividends. Take in the example of real estate, most appreciate with time. So be patient, this is a must if you want to be a good investor.
Discipline is key if you want to be successful at anything, this includes investing as well. You need to have a set of rules that you follow to the latter. They need to be well laid out for any investment that you embark on. Have a set of rules for the research part, for the planning part, for the contingencies, what you need to do in the event of anything. You need to be disciplined in all stages of your investing, if discipline is a problem for you… You are up for some trying times.
For any great investor, they know that being open-minded is very key to any investment. In the sense that if an investment looks unorthodox but has the potential to make you money, you shouldn’t close your mind off to that possibility. Some of the greatest investments came from very unorthodox services that no one thought would work, but they did anyway. For example; Airbnb, Uber, Netflix.
Know your limit
This is the part that most people fail at becoming investors, knowing your limits. You need to know what can you afford to lose in any given type of investment and what would happen in the event that you did lose all your money in that investment. Will you go into depression and curse the gods that they were out to get you?
Or will you get back up and go back to your drawing board again and start from scratch and try to rebuild from the experience that you have just received? Or will you give up on it entirely and decide to do something else? This is the making or breaking point for any investor and it is best to know how you would react in this scenario. So before you begin on this journey, really look into yourself and decide if you can handle the loss.
That’s my take on the characteristics that most successful investors have had and ones that you need to carefully look at if you have them. To avoid disappointments later on after something major has gone thoroughly wrong. You cannot afford to make any mistakes with your money especially money that you may have worked for a better part of your life. Make informed decisions, do your research before you embark on anything. And always have a plan.