You Need To Check Your Emotions At The Door Before You Invest In The Stock Market

We have all been victims of other people’s stock advice. “This stock is guaranteed to go up!” Sometimes the advice comes from a neighbor, or a close friend. It may even come from your own investment advisor.

Our emotions get us thinking. You don’t want to lose out on the potential gains. Irrationally, without blinking an eye, you invest. Most of the time the end result is much worse than you expected. Surprisingly, you continue to repeat this same mistake over and over again.

What is wrong with our thinking? The answer, for most of us, is that our emotions take control of our decisions. They are so powerful that we often ignore our rational, logical thoughts. The opportunity for a quick dollar or hope to “get rich quick” heightens our emotional thinking. You must realize that it is not the rational side of our brain that is tripping us up, but the emotional side!

We tend to ignore many sound investment plans due to emotions. You can, however, quiet that emotional side that forces you to ignore your well thought out investment strategy if you work at it. You can learn to stick to your investment plan through both good and bad times.

Some investors, however, cannot shake the investing demons that compel them into making the same mistakes over and over. It is this type of trader that cannot overcome emotions while investing. They often lack the experience that allows them to treat investing like a business, and not like a game of poker.

The main driving emotion for many investors is the fear of losing money. The next is making a quick buck. Lets not forget to mention greed, the king of all emotions. All of these cloud judgment and prevent you from thinking clearly about how an action affects your portfolio. It doesn’t take long for disaster to strike when this kind of thinking is in play.

When investing, I had a difficult time getting my emotions under control. I was finally able to control my emotions and let my logical side control my investment decisions. To help me do this, I developed an investment system that I use over and over with consistent success. I have certain parameters that I follow to guide me towards the right kinds of investments. This system is black and white, very logical. Now I remain focused and stick to my strategy even when that emotional beast tries to rear its head.

There is no shame in making poor investment decisions over and over. There is good news, you can change things starting now! I made that change and as a result I have been more successful than I ever have been investing in the stock market. I also managed to do this when the stock market was in a sharp decline! I promise you, to be a successful investor all you need is a solid investment strategy and the ability to keep your emotions checked at the door. Take the advise of someone that did that very thing!

Has The Stock Market Got You Down? Are You Concerned About Your Ability To Retire?

Did we ever think that a decade or more of stock market gains could be wiped out over a period of several months? The years of easy 8% to 10% annual returns are long gone. Do you find yourself asking questions? What am I going to do about my retirement projections that used those annual returns? How will I ever get my finances back on track? Well, we have entered a new age with new questions to be asked. What are you going to do?

You need to take control of your investments. You can no longer rely solely on the advise of your broker or financial advisor. After all, didn’t they allow you to get into this position in the first place?

You as an investor must learn to think differently. You might find that you can no longer afford to wait until those precious stocks recover, you know, the ones that you have an emotional tie to. That is entirely alright. Who cares from where your positive investment returns will come. What is important is that they do come.

The average investor needs to change the way he thinks. We need to teach ourselves to invest not with emotion, but with common sense. I treat my investing activities like a business. If a particular trade is not working as I had out as planned, I close it out and move on.

I have been told by real estate investors that the profit is made at the purchase of a property, not on the sale. Is it possible to apply that to the stock market? Absolutely, I have clients that do that very thing.

A change in thinking will shift your focus to monitoring the trade during its expected life. I say expected life because that is known prior to entering into the trade. You will no longer just hope for a particular trades increase in value. Yes, you will know your exit strategy prior to entering into the trade!

You need to teach yourself to run your investing activities like a business, monitoring the trade through its life cycle. You will no longer be at the whim of the stock market. I can assure you that you will feel in control of your investments.

Surprisingly, there are stock market investing strategies that allow you significantly more control over the outcome. The stock markets most successful investors do not just hope things go their way. They have tools at their disposal and they use those tools to give them the best chance of success.

Successful investors rely strategies that tip the odds in their favor, and they have learned to treat investing like a business. What are these strategies? Well, that is beyond the scope of this article. However, in order to find success you can start by changing the way you think.