Stay the course

 By now you would have guessed that I am huge fan of equity investing as a route to creating immense wealth. As much as it a very simple process, most fail to achieve this goal on account of a simple issue; shortsightedness.

Human psychology plays a HUGE role in the process and one needs more of a good temperament and not necessarily a high IQ. The ability to ride the waves and have a long term view of the process is critical. And often most investors fail in this area. 

In the times of instant noodles and instant photos, patience has been a big victim. Investors cannot control the urge to get ahead of themselves and start feeling impatient about the investing process. We expect quick returns. We expect the outcomes immediately. Unfortunately investing in equity is a slow but sure path to wealth. But only we if we have the patience to stay the course. Set out a 15 years plan once you start your investment journey. Remain focused on the process and methodology. Maximize your investments as much as possible and do not stress yourself about the returns. Shortsightedness often makes us lose steam and abandon the process. Remain patient. 

While you are here you may want to check out my video about Retirement Planning

Another reason why many investors fail to build wealth is their inability to ride the short term volatility. Market are volatile in the short term. Often very volatile. But history has shown us that the market keep rising in the long term. But many investors tend to abandon ship and end their journey due to short term loses that they experience when markets turn volatile and drop sharply. Markets dropping sharply is in fact a golden opportunity to add more to the portfolio. Imagine panicking when the store next door announces a huge sale on TVs or washing machines. Isn't it a big opportunity to make that purchase? In other words, market dropping sharply is a great opportunity to add most to your portfolio at discounted prices. But most importantly, if you cannot make additional investments, hang in there. Every bear market has been followed by a bull market. Stay the course.

If you continue unfazed despite the ups and downs of the market, you are very likely to generate huge wealth over the longer period if you stay the course. Investing is a marathon. Not a 100 meters race!