Common Barriers to Investors and How to Overcome Them
“Common Barriers to Investors and How to Overcome Them”
Many investors, surprisingly enough, base their decisions on emotions alone. Some rely on rumors or word of mouth. Some chase the next trend hoping that it will be the next big thing and, more often than not, end up losing money as a result. And these are scary habits to get into if you plan to allocate millions for your investment. Removing these barriers to success is crucial to changing investors’ behavior and enabling them to succeed.
Each investor has his or her own set of hurdles to overcome, and these are some of the most prominent ones and possible workarounds.
Common Barriers to Investors
Emotion is one of the most common of human experiences. Fear and greed often cloud one’s ability to rationally think when it comes to any investment opportunity. This results to poor decisions and, consequently, loss of money. Remarkable dents on one’s account balances and increased stress levels are sure to follow. One thing to know when it comes to investment, and I can’t stress this enough, is that you need to develop the skill to know when to go, and more importantly, when to stop. This is evident enough when it comes to loss. Learn how to cut your losses and pull back should you need to! Because of frustration, many end up losing a hundred dollars when they could cut it to just ten.
READ MORE: What are the Costs of Being Unprepared?
Lack of Knowledge
Investors sometimes have little understanding of how the markets work, what drives stock prices, and the important metrics to take note of when it comes to analysis. Furthermore, many investors tend to overestimate their abilities to beat the market, and as a result, take on unnecessary and uneducated risks. Many are also confused by the notion that rebalancing entails selling some of the investments that have performed best and buying more quality stocks that have lagged. Sure, this works on occasion, but do you know the foolproof way of assessing one’s success?
Educate yourself. While it is true that there are easier ways nowadays to enter the investment market, the risks still remain especially if you don’t have the slightest idea of what you’re entering into. You can’t expect to win at poker if you don’t know the cards. Success on anything requires effort and knowledge. Learn from scratch if you have to. There is no shame in that.
Losing Sight of the Big Picture
While many investors say that they do so with a long-term perspective in mind, they continuously make decisions based on short-term movements and trends. When the average investor realizes that the market has risen, they pour in cash into stocks and mutual funds, trying to capture some of the profit within a very limited window of opportunity. They focus on what they have right now instead of looking at prospective long-term gains.
How to Overcome Them?
No matter what your barriers might be, it is important to put together an action-oriented plan to overcome them. Here’s how:
- Stay focused on what you need to change: You must remain focused and more importantly, act consistently and accordingly based on your goals. If you feel you are having a series of impossible backlogs or distractions, take a break. However, make sure that by the end of the day, you get back.
- Learn to think marginally: You can’t move the market, so you need to assess what is the greatest option to take and use it to your advantage. Assessing what is most likely to happen in terms of probabilities will help you make valid investing judgments.
- Learn to be objective: Investors are best served if they maintain an objective perspective. If you do so, you won’t be pressured to act quickly and irrationally because you based your decisions on facts, not intuition.
Learning about investments is deliriously hard—you must know what you’re actually doing to succeed. Don’t jump to the conclusion that just because you have the means today to invest automatically suggests that you charge head-on recklessly. Err on the side of caution. Always.
You will develop better spending habits.
Investing early trains you to save and to set aside a portion of your income instead of wasting your money on unnecessary things. It is actually a good habit to get into your system to set you up for success. Millennials nowadays tend to spend just because they have extra money regardless if they actually need to or not.
From an investor’s point of view, people pass away every day, there will always be a market for it. And considering its appreciation value, you’ll be able to price yours competitively—in an amount that’s higher than the price that you bought it for, providing you a generous amount of income, yet lower than the current market selling price so as not to make it hard for the buyer. It’s profiting and helping at the same time. Win-win, am I right?
About Golden Haven
Golden Haven Memorial Park is a subsidiary company of publicly listed Villar-owned Golden MV Holdings Inc. Currently positioned as one of the largest real estate companies in the country. Golden Haven offers premium death care services and prime memorial lots. Dubbed as the most lucrative real estate investment with an average of 20% annual value appreciation.
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