The Three Pillars of Successful Investment - Psychology (part 2)

PUBLISHED Dec 29, 2022, 3:18:51 PM        SHARE

imgTom Hamilton

Finding the Path Toward a Strategyimage description Since we are all different, we will need to find our own individual path(s) toward defining the strategies that we can use to effectively manage a portfolio. The first step in this process of self awareness is to set aside some time when you are free to assess yourself. This is not a task to dread or rush through, but a time to pause and reflect. What follows are two exercises: a Personality Profile and a Left Brain/Right Brain Information Processing Assessment. Our personality and preferences are major factors in determining how we function and behave. They also have an effect on our professional approaches to problem solving and business organization. The results of these exercises will be combined to give insight as to what type of portfolio strategies we may be most compatible with and comfortable running. It is important to think honestly about ourselves, what we like and what we don’t like. Get in the right mood, calm and introspective, jot notes down on a pad of paper. Find a quiet time when you won’t be disturbed, this is all about you and no one else.

Some areas for you to consider are how you function in a social activity with people. What characteristics of people do you admire? Do you prefer to interact one on one, in small or large groups? Also consider individual activities and what satisfaction you derive from them. What activities do you find creative, relaxing or stimulative? Are you interested in one task at a time or fascinated with many? What activities do you enjoy or avoid; consider what classes you enjoyed or disliked in college or high school? Are you happy to work toward a goal with a deadline? Are you organized or messy? All of these, and more, are part of your unique personality.

• Personality Profile Assessment: The author recommends taking a Personality Profile test that will help in the identification of characteristics, so you can determine a group of compatible investment strategies. This first evaluation will ask questions about how you work and what you prefer to do in various settings. The scoring is immediate. One such site is: http://www.outofservice.com/bigfive 1). It will give you a percentile score in the OCEAN personality model (Openness to experience, Conscientiousness, Extroversion and Agreeableness). The results give you additional insight as to your level of creativity, organization, sociability, interaction with others, and nervousness / relaxed states. Responses will be evaluated on in the areas of Logical-Social, Reserved-Outgoing and Tried & True-New & Different. There are no right or wrong answers, only more information about how you function and work. You will combine these results with the next exercise and begin to see a pattern. The pattern is the manner in which you think, learn and prefer to act, and respond to situations. image descriptionimage descriptionimage description The next area to review is how we learn new things, and react to new stimuli. This is a major factor in what makes us different. The left brain / right brain theory explains how our brain functions, in short, how we are “wired”. Research indicates that the brain is divided into two main hemispheres. Each specializes in different functions and processes information differently. This, in part, defines how we deal with problems. The left brain processes more logic and analysis functions, while the right brain processes more emotion and imagination functions.

Sound investments
don't happen alone

Find your crew, build teams, compete in VS MODE, and identify investment trends in our evergrowing investment ecosystem. You aren't on an island anymore, and our community is here to help you make informed decisions in a complex world.

More Reads
Monthly Dividend Utility Stocks

This article covers all we need to know about Monthly Dividend Utility Stocks.

Is Duke Energy a Buy?

Find out if Duke is a Buy in this article.

What is a Stock Selection Guide?

The Stock Selection Guide is a great stock picking methodology that uses a company's fundamentals to assess its investment viability.

Japan Surprises

The Bank of Japan surprised everyone may lifting the 10-year yield curve cap to 0.50% from 0.25%.

The Top Value Investments

These are the top value stock ideas picked by the top investors on the platform.

The Top Financial News and Analysis

The top articles and commentary on recent and relevant financial, economic, and business news.

The Top Macroeconomic News and Analysis

The articles and commentary on world macroeconomics that are relevant now

The Top Stocks Analyzed Using the Stock Selection Guide (SSG)

These top stocks were analyzed using the stock selection guide and picked by the top investors on the platform.

The Year Winding Down

Stock Market Commentary

Why is Book Value Important?

Book value is a investment metric that new investors need to understand. Book value gives investors an insight into a stock's intrinsic value.

Is Entergy Corp a Buy?

Entergy is trading at a significantly lower valuation than its competitors. As a result, the company is currently undervalued, and better to buy it. Read more.

Is Exelon a Buy?

Exelon Corp. ( EXC ) is getting a lot of attention these days, with analysts and investors trying to figure out if the company is worthy. Read more!

META Lesson 2: Accounting Inconsistencies and Consequences

In my last post I used Facebook's recent troubles to talk about the importance of corporate governance

How to Strengthen Your Four Walls of Budgeting

When you are in debt, it may feel like you are digging yourself deeper with every dollar you spend. And as the bills start mounting and collection agencies are pressuring you to pay, it’s easy to panic and forget your priorities. However, knowing the four walls of budgeting can help remind you what is most important in your budget. So if you are having a hard time making ends meet, here are a few ways you can strengthen your four walls of budgeting and get closer to your financial goals.

What Are The Best Stocks To Buy Now?

As an investor, one of the trickiest things to figure out is which stocks to buy and when. The holiday season and post-midterm climate alter the landscape a bit. Additionally, many companies are examining their year-end figures, with some exceeding recent expectations and others falling notably short. As a result, it’s hard to choose the right investments. If you’re trying to figure it out, here are some of the best stocks to buy now.

Let’s Debunk These Top 7 Credit Score Myths That Often Misguide You

Your credit history and credit score are how a lender determines your creditworthiness. A good credit score shows the lender that you have a lower risk. And a poor credit score implies otherwise. No time to read this now? Pin it for later. Today, there is a ton of information about the importance of your credit scores and the need to check them regularly. But you don’t have to check your score daily. That’s just a myth. There are other credit score myths out there, but this article will debunk the top seven credit myths.

Positioning to “Time” the Stock Market

You can’t time the market! Many have tried, and many have failed. But there is an acceptable way for investors to time the market: what about positioning assets rather than predicting the future? As the saying goes: time in the market is better than timing the market.

23+ Best Places To Buy Cheap Clothes [Updated]

You can buy cheap clothes and still look stylish. However, there is no denying that buying an array of clothing can be expensive. One way to cut costs is to buy second-hand clothes. But there are ways to buy new clothes without spending a fortune on your wardrobe if you want something new. This blog post will show you 15+ of the best places to buy cheap clothes.

Doves In Hawk Clothing

When the time comes, will central banks prioritise employment or inflation? The goals of central banks are price stability and maximum employment. For much of the last four decades there was little conflict between the two. Strong disinflationary forces meant that unemployment, outside of recessions, could be kept low.

Early Retirement Hindsight: What I Would’ve Done Differently

I feel truly blessed to have been able to pull off an early retirement. I take great pride in being able to take the leap at the age of 51. It came after a long career with a less than a 6 figure salary. Still, after experiencing early retirement for many years and knowing what I know now, I often think about what I would have done differently. Allow me to share my early retirement hindsight.

Resources for Publishers
Resources for New Investors
Boosted with BossCoin