Hi all I believe we are either our strongest ally or own worst enemy when it comes to investing (stock market, property, gold/silver etc). Watching the losses (on paper until sold to crystallize losses) can do somebody's head in. It can lead to a person making rash emotion based decisions! So my question to the esteemed SS forum members is how you manage your emotions when investing.
When the bombs start falling everyone forgets what they thought they would do. Though still not certain, gold is the best bet of all the possibilites,
Seriously AgH2O, I am a bit stumped. I have been investing for a long time, and I am not sure how to answer? :| I don't have any trouble, as I don't have any emotional attachment to any of my investments. All investments are just tradeable items which you can sell and buy back later at any time. If you are talking about price fluctuations, such as with metal stacking, then I suppose this helps me: 1. Don't invest more than you are willing to lose, and be prepared to shrug your shoulders and walk away if it all goes pear shaped. 2. Have an exit plan to prevent point 1 from ever wiping out all your capital if it does eventuate. 3. Treat it like a business, not like a punt (exciting/emotional) so you don't get caught up in any excitement or dissappointment. good investing is often mundane. 4. Use fluctuating spot price to watch with interest (and sometime amusement) how the market participants react. A good example is right now - a dip in spot and everything has gone quiet. Figure out how to use these market behaviours to your advantage. 5. A dip in spot hasn't cost you anything - your money is tied up anyway, so don't fret. 6. Never put yourself in a forced sale situation. 7. If you are fretting, ask yourself - has a change in spot has really changed your life today? The above sounds a little too philosophical, but honestly, your life does not depend on it, does it?
Thanks wrcmad. That's what I was after here. Glad you pointed out that without a well thought and written out plan (and sticking to it), we can get derailed. In a recent conversation with another enthusiast, they mentioned that some people panic and sell (for not good reason except that spot prices are down). To be able to treat it like a business and not take things personally (which is what happens when emotions get in the way) requires some degree of self awareness, and emotional intelligence (ie managing our own emotions). I reckon that successful Forex traders got that part sussed.
Not everyone is business savvy, to suceed in a silver strategy you need to also know how to be business savvy Buy low .. ie as close to spot as possible, get the best deals on the market at the lowest price possible sell high.. dont sell until you realise a decent profit.. I dollar cost average to avoid any nasty downside and sell when i can realise a decent profit and book it, but i always have a bunch of skin in the game. If your not business savvy just dollar cost average and wait for the the final stages of the bull run and get the best prices you can when you get out. My advice is to have a very mixed life and not solely depend on silver for happiness, if you vest all your energy and time in silver it can get depressing so dont abuse it and be modest and exercise moderation and it will be good back to you 1for1
Great advice 1for1. I have noticed in my business dealings that some people make investing all about themselves ie they take things personally. That is a recipe for disaster. Your point about having a wholistic approach is what I'd suggest too. I say to people if you can't be happy now, having a truckload of silver (gold, $$) is not going to make you happy when you get it. I have found that investing is an inner game of knowing myself and managing my own emotions.
I just go surfing and that makes me feel better. I have (hopefully) 20,30 or even 40 years to wait if I have too but realistically I'm just using pms as a savings account until I have enough to buy a rental property or a proven profitable business.
Excellent long term strategy, Sargeant Argent! I am with Mike Maloney on his wealth cycle investing plan. He is using gold/silver as an under rated asset now to buy property when that hits the decks in the coming years. Bottom line is that people will still need somewhere to live (ie a roof over their heads) regardless of whether it is a boom or bust time. Rather than be one eyed about a type of investment, know that these asset classes move in and out of favour depending on the economic cycle and invest accordingly.
Too true! And you'll be scared to open your wallet! Spot prices are fun to watch ... doesn't particularly bother me what I actually bought for, I only get nervous if anything might be affecting the underlying fundamentals (eg Headline such as "Greece discovers huge gold deposits in rural areas"; "China sells all its gold on new fears of radioactive mutation" blah blah. I do buy on what I consider to be a dip. Remember one man's dip is another man's turmoil! Most of it is noise, honestly. Go for the fundamentals (as you say, people will still need a roof over their heads, in all but the most extreme circumstances (eg war; man-made disasters; civil breakdown).
