Joanne Kirk
Consultant
Invest like a business-owner
Here’ s what an emotional investor does: Checks the market constantly, worries about every uptick and downtick, rapidly realigns his or her portfolio at the first sign of a stock or market downturn, tends to jump into and out of the market chasing hot stocks and dumping down stocks. An emotional investor severely limits his or her chances for long-term financial success.
Rational investors know that the best approach is to take the emotion out of investing. Many of them are business-owners and replace emotional investing with a business-owner approach. They have found success incorporating these business-owner principles into their investment plans.
Clear investment goals Rational investors set goals and have the discipline to stick to them. Yes, they want to make money but they set their return objectives against clear short- and long-term goals.
Know when to delegate Successful business-owners know they can’ t do everything themselves so they hire capable people with the talent and ability to enhance their business. Similarly, rational investors delegate their investment decisions to professionals who have the talent and ability to help them achieve and sustain their financial goals.
Be risk averse Both rational business-owners and rational investors definitely want to create wealth but they also understand the need for wealth protection. That’ s why their portfolios are carefully crafted and well-diversified to reduce risk and provide more stable returns over the long-term.
Just the facts Rational investors make investment decisions based on facts not on feelings. They do not get caught up in“ the investment flavour of the moment” and are careful to keep their emotions out of investment choices.
In the know Rational business-owners keep a daily watch on investment news and consider its implications but like rational investors, they also keep their focus on long-term trends not day-to-day fluctuations.
Seize opportunity Rational individuals, business-owners and investors alike, trust their intelligence. They actively seek money-making opportunities – especially in a volatile market-- by hedging, shorting and using other investment strategies to pick up assets at bargain prices.
Miko Photography
If an unemotional business-owner approach to investing appeals to you – and it should because it’ s often a better path to financial success – then talk to your professional advisor about the investment strategies that work best for you.
This column, written and published by Investors Group Financial Services Inc.( in Québec – a Financial Services Firm), and Investors Group Securities Inc.( in Québec, a firm in Financial Planning) presents general information only and is not a solicitation to buy or sell any investments. Contact your own advisor for specific advice about your circumstances. For more information on this topic please contact your Investors Group Consultant.
Consultant JOANNE KIRK, FCIP, EPC
Investors Group Financial Services 100, 37 Richard Way SW, Calgary, AB T3E 7M8 joanne. kirk @ investorsgroup. com Office: 403.253.4840 ext 2511 Toll Free: 1.877.433.4840 ext 2511 www. joannekirk. com
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