Patience is defined as “to accept or tolerate delay, trouble or pain do not get angry or upset ability.” Eighteenth-century philosopher Jean-Jacques Rousseau once said, “Patience is bitter, but its fruit is sweet.”
As in real life in many ways, the huge investment needs patience amount. Individuals often become volatile when more and more uncomfortable, and inevitably long-term goals and short-term anxiety shift their focus. What is the main contributor to this phenomenon, it is known as the “recency bias.” Recency bias is considered, since recent trends and patterns will continue in the future.
2008 financial crisis, the epitome of this thought process for many investors. Some of the most e-commerce ducated, long-term investors become increasingly skeptical about the beginning of the 2008 financial crisis turned into weeks, weeks turned into months. These same investors become so easily lead to a vicious cycle of fear in the market, they lost patience and discipline need to adhere to in the end.
Who is your worst enemy
Benjamin Graham, the father of value investing, has said it? “The main question for investors – even his worst enemy – is likely to be their own” as a financial adviser, we play many important roles in the customer’s life, but the most important is to help our customers focus in the long-term game plan. All of our research, configuration, diversity, work risk management, cash management, etc., is less sense if investors ignore its long-term investment objectives.
As an exercise, think back in time in your life, you are excited to start a new challenge. You know the challenge is not so easy, but it is likely to require a significant amount of sacrifice in the short term. Ultimately, however, it will benefit your life in the long run. Perhaps your challenge is to begin a fitness program, promote healthy eating habits, or become better parents. Whatever the challenge, there may be a few bumps along the way.
These various challenges of life comparable to invest in your future challenges. Success depends on a certain level of patience. And tough, it may require a large number of ng ALO disciplined way, but most importantly, success requires patience. Patience is allowed to discipline and dedication turned into a vehicle ahead.
Bad news breeds irrational behavior
Mark Twain (in front of him might be a few people) once said, “I have in my life suffered a huge disaster a lot. They most never happened. ” Many investors have to focus so much attention, it dominates their thoughts natural tendency of negative news of the day. They focus on short-term negative market report leads to anxiety, then this could lead to irrational investment decisions.
Heightening prudent investment must be reasonable in many cases. We do not advise clients to bury their heads in the sand and ignore their investment. However, it concluded that recent economic events for a future theory may be wrong. Appropriate risk management needs of the perspective and balance – especially in a volatile time.
At the time of market turmoil, it often seems reasonable to take some immediate, decisive action – just because. But based on the forecast of a hurry and often counterproductive actions, bitter regret them quickly, but the emotional reaction the investors. We may not fully control during tough times our emotions, but we should always try to listen to the wisdom of our mothers teach, because we are brought up: Patience is a virtue
Remember …. Your mother is always right!