All of us love when an investment comes together. We have all experienced that rush of positive emotions when we find an investment, buy in, see our money grown and then reap the rewards. You research your investment, nervously watch it grow day by day and then get out at the perfect time. You have made money literally out of thin air and you feel like a king. You feel invincible and powerful. With grace and confidence you have earned money wisely through investing it.
On the other hand, there are some of us that allow investing to rule our lives. An investment pays off and we feel like a winner. When an investment doesn’t pay off we feel like a loser and we begin to chase that emotion so fiercely that sometimes thought and reason leave us and we begin down the path to addiction.
It’s tempting to check the status of your investments. You’re curious. You want to see how things are going. You want to know if you made the right choice on an investment. On the other hand, if you find yourself checking your accounts and your mood changes depending upon if your investment has improved or not then you might have a problem.
Once you have committed to the investment, set everything in place as far as sell order and stops then there is no need to check on your investment more than once or twice a day. Your time could be better spend doing something else or even researching other investments that might interest you.
Going to the ends of the earth looking for tips or information that you think will give you an edge or advantage is another sign that you have an unhealthy attitude towards investing. Watching or reading the news or trade papers is legitimate. Making up your own mind about a stock or investment is even better but taking investment advice from faceless names that haunt message boards and email newsletters is craziness. The desperate desire to turn a profit with an investment which overcomes your good senses can cause an otherwise savvy investor to throw good money after bad and do anything and everything to recoup losses or feel that winning feeling again.
There’s a pretty good chance that you have a type of investment that you prefer. There is probably an area that you have some specialized knowledge in or a keen interest. You enjoy learning more about stock, bond, futures, foreign exchange or precious metals investing. While you might have always dreamed of branching out and learning about other forms of investing, jumping into an investment without having a good knowledge of the market because of emotions is a bad move.
It can be tempting to take the advice of a good friend or business partner but check your motives. Are you investing because you have an interest in the investment or because you want to turn a quick buck? Look before you leap and understand the market unless you are fully prepared to lose the money that you’re investing anyhow.
Often the bottom is reached and a good investor turned back realizes his or her folly as they figuratively lay in the gutter looking up at a loved one after they invested a good portion of money that they shouldn’t have. Investing money that was put aside to pay bills or in a savings account for a child’s education or for a special purpose is often the last straw. Lying to yourself or your spouse or partner about money is a sure sign that you have a problem.
Withholding the truth is also just another form of lying and if you find yourself tempted to invest money that has not been set aside for investing then it’s time to stop and take a careful look at yourself and your behavior. Be honest with yourself. Be honest with your spouse or partner. It might be the best thing that you ever did in your life and you very well might avoid total financial and emotional ruin if you have a problem.
If any of these points strike home for you then you are encouraged to take a closer look at what you are doing with your investment activity. While it is a pleasant experience to make money through investing, it should never be something that is addictive or that you chase after. There are plenty of opportunities out there in investment vehicles that you are interested in. Learning about investing can be fun but chasing after money is always a bad move in investing.
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