If there’s one thing new investors aren’t short on, it’s advice. There are so many “investing adages,” “Wall Street adages,” and other golden nuggets meant to guide investors, it’s overwhelming.
There’s some truth to all of them, and they all have their place for investors who might find themselves facing a difficult situation.
But here’s the thing – none of them really help investors make the most important investing call: the decision to get started. It turns out investors often find that figuring out the market isn’t nearly as important as being in the market in the first place.
Fortunately, whether you’re an absolute, rank beginner or someone who’s been sitting this bull market out on the sidelines, I’ve got some help for you.
Here it is…
“You’ve Got to Be In It to Win It”
Sounds easy, right? That’s because it is.
In fact, I’ll prove it to you right now, and you’ll not only have the confidence to start investing, you’ll wonder why no one ever told you this before.
In order to be totally comfortable investing – and I mean absolutely completely at ease with it – you only have to know two things. Everything else you’ll learn along the way to becoming super successful.
The most important thing you need to know is that every investment starts with a “trade.”
All that means is that no matter how much or how little research you do, or if you’re taking a position on something – anything – based on something you read, or heard, or “feel,” it’s always the same.
You have to make the move. You have to buy the stock, the ETF, whatever it is you’re trading. You have to open a position.
Putting that position on is a “trade.”
You aren’t investing in that position. You might end up with a fabulous investment, but you might not.
By looking at any position you open as a “trade” and not an “investment,” you know you’re not “married” to it.
If you love it because it goes your way, go ahead and marry it. But if it goes against you, you simply get a no-fault divorce and dump the position. No entanglements, no tears, just maybe a small loss.
And you move on, a lot wiser, and hopefully not too much poorer, for making the mistake.
Every time you initiate a trade – every time – there are only two outcomes that you face: Either the trade goes your way or it doesn’t.
If it doesn’t work out, take a small, manageable loss, say 5% or 10% of the capital you put into the position, and get out of the trade – but don’t let the fact that you cleverly escaped with a tiny loss go to your head.
I always think like a trader when I put on a new position.
I know I could be right, but there’s always a chance the market or the stock does something I don’t expect, and the position goes against me.
At least I’m in the game.
You can’t be afraid to lose a few bucks. It’s part of the game. You can’t win a race if you don’t run it. You don’t start off running. You start off taking a first step. You start off with one trade and – BAM – you’re in it.