Basic Investment Strategies, Part Ten: Learn to Let Go
Tuesday, April 29th, 2008
Ever hear of those “fantasy sports” leagues? People meet up on websites or even in person to build their own fantasy sports team comprised of all their favorite team members from all the various teams throughout the actual league. Then, every time a game is played in real life, the performance of the players who are involved in each person’s fantasy team are evaluated and an overall value is given to each fantasy team. At the end of the season, the fantasy team that contains the most valuable players is announced as the winning team.
The Fantasy Stock Market
Some people, it seems, like to play fantasy stock market. They do an awful lot of speculating in “what ifs” and it tends to take time away from their actual investing. This is especially true of those individuals who can never seem to let go of a stock once they sell it. We’ve all probably met someone like this. They had a poorly performing stock so they decided to sell all their shares in it. But now, they check the status of that stock more obsessively than when they actually owned it! Even though it can’t possibly affect them now which direction the stock takes, they have to know how it’s doing anyway, they have to know if they made the right choice. What if they didn’t? What if they would have been better off holding on for a little while longer?
Learn To Let Go
Letting go is one of the most important lessons to learn in the stock market. The fact is that you’re going to pick some duds over the course of your career as an investor, and when you do, you need to just forget about them and move on. If you’re constantly looking backwards and dwelling on your mistakes and whether or not they were really as bad of mistakes as you thought they were will prevent you from doing what every real investor needs to do: look ahead to the future.
Stocks Poor? Ditch It!
If you have a poorly performing stock that’s causing you grief, sell it and let that be the end of it. If you happen to come across a report of how it’s performing, fine, but don’t bother to seek it out. You’re just wasting your time. You might as well try to keep tabs on every single stock in the exchange! Instead, focus on those stocks in which you still have an actual investment, and those on which you’re thinking about investing in the near future. They are the areas that are really worth your attention and concern.
See you next week for part 11 of Basic Investment Strategies.
Sean Rasmussen
The Bullhunters Guide
Universal Wealth Creation © 2004 - 2008
