Fear of Tomorrow

The worst mistakes of your life are done when you are afraid. Never allow fear to be the motivating factor on whatever project you are embarking on. The Exchange is a bad place to be motivated by fear. The fear of losing money has kept so many people from becoming wealthy via the exchange. They do not understand how it operates and at the same time do not bother learning about it, and so they happily put a good chunk of their earnings in saving accounts or fixed deposits.

The second level of fear is in those who invest but cannot stomach seeing a stock they bought going below the purchase value. To them they are losing money, no matter what the reason is. The stock market is operated by principles. Things make the prices go up and down. When you seek to know the “whys”, you will deliver yourself from this level of fear.

The fear of tomorrow makes you jittery and when you are in that state of mind, I can tell you, you will definitely not make a good decision.

Pension

There is so much to do with life than waiting for pension. Get busy living. Don’t wait for this and that time. As it was said in the movie, Shaw Shank Redemption, “You get busy living or you get busy dying”. Life is an active game. Warren Buffet says “It doesn’t take a muscle to do what I do and so I’ll be here for a long while”. I’m amazed by the multitude of young people that are already planning for their pension. It’s good to start planning early, but please let not the fear of “what will I do at old age” cripple your daily living. “Sufficient unto this day is the evil thereof. Tomorrow will take care of itself”. Enjoy the moment. Plan what you want to do in the future, but don’t be obsessed with it in such a way that you miss the present.

If the issue of planning for your pension is the sole reason you are investing, then you are a candidate for suicide if the Enron drama should hit any company on the stock market that you have invested in. Always remember that resilience is one of the attributes of a smart investor. When you know the rules of the game, you can always play it anywhere, any day and anytime; no matter the trend. Please aim for the knowledge; for with it you can always achieve your desired result anywhere in the world.

Hear Say. Dem Talk Say…..

Remember when pure water business was in vogue? Everybody wanted to join the band wagon until such a thing as NAFDAC arose. Many lost quite some money in those investments. They didn’t do their homework properly. They heard that, “if you can muster up some money you can start the business” and they jumped in. This is a business problem all over the world. America had its dot.com problems. It was an era many lost their life savings.

People heard that when you invest NGN 1000 in this business, in 3 weeks, you will be making NGN 1000 a day. With no insight or foresight they jumped into the boat, never knowing they were boarding the Titanic. This is what gives rise to the fact that 90% of business and enterprise never make it to the 5th birthday. ‘Hear say’ has never been the best way to be an intelligent investor.

The same scenario plays out itself at the stock market. People hear, “Hey, I bought FCMB at NGN4.10 by January, now it’s NGN15+”. The next thing they do is either buy FCMB or a stock at NGN 4 hoping it would also hit NGN15.  No analysis, no news, no prior information.

I meet people daily who always say things like “I have NGN 250, 000 and I want you to tell me where to invest. I heard you did this and that and you got some results”. It’s the most terrifying preposition of adult life. Don’t operate on hear say. I’m not investing because they said the market jumped and will be jumping always. Get into the game and see how things work. No matter what I’m told about this or that stock I try to verify for myself. I’m not trying to be too smart, but just a little careful. I think it’s a wise thing to do.

Easy Profit

Profits never come easy. People put in efforts, and the results are sometimes very profitable and other times, not so profitable. Sometimes, it also results in debt. Sometimes, it takes a while for your investment to start being profitable. Remember the break-even period theory. That’s why, there is some thing called break-even point in business.

When all you do is chase profits, I doubt if you’ll ever catch it. Am I saying that you should make a dumb decision not to get profitable? No! No!! No! I’m just saying, may profit not be your only criteria.

I believe that after reading this, you will be able to tell yourself why you are doing what you are doing. You will be able to list compelling reasons why you are investing. These reasons must be core to your values. I’m not against making profit, but instant profits and speculations are great when you are on the right side, but when you are on the receiving end of it, you might be ground to powder.

Great investors are not made on one deal; they are made over making several good deals, just as you do not get to be on the number slot on the ATP ranking. You get there by beating several top class tennis players consistently over a long while. View your life as an investor this way.