When you think of a successful investor, you might picture wealthy individuals born into a world of shares and bonds, with a natural born knack for predicting market trends. However, the skills required to be a cracking investor aren't handed down like family heirlooms, they’re actually learned & earned, more often than not at the ‘school of hard knocks’.
I get it, some folks can have a leg up due to their family background or connections, but that's just the beginning and if you want proof of that, history is littered with the heirs of a wealthy family who have lost it all.
Education Is King
Let's get one thing straight, you don't need a fancy degree from a prestigious university to be a successful investor. What you do need is a hunger for knowledge, patience and an ability to embrace and learn from your mistakes. The stock market is a beast, but it’s a beast that can be tamed with the right knowledge and information.
Start by understanding the basics. What are shares, managed funds, bonds etc and how does the market even work? There are countless resources online, from beginner's guides to in-depth analyses. Read books, follow financial news, listen to podcasts and if you're committed, take an online course. The more you know, the more confident you'll become.
Mistakes Are Your Best Teachers
All the knowledge in the world is useless without action and many budding investors do all the learning but never put their hat in the ring and have a go. Many shy at the first hurdle. Every successful investor has made their fair share of blunders. Mistakes hurt – not just financially but they also dint the ego. You have to get comfortable with the fact that mistakes are part of the game, but they're also your best teachers.
Patience and Persistence Pay Off
If you're expecting overnight riches, you're in the wrong game. Patience is your secret weapon. Take compound interest, it’s like planting a tree. The sooner you start, the more time it has to grow into something substantial.
So, there you have it. The skills that transform you into a bloody good investor aren't bequeathed through some lucky gene pool. They're earned through education, refined through mistakes, and solidified through a mindset of patience and persistence. Whether you're starting with a small stash or dreaming of managing a massive portfolio, the path to investment success is open to anyone willing to have a crack and stay in the game for the long term.
Cheers, Ben
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Disclaimer: The information contained in this article is general in nature and for education purposes only. It is not financial advice. No one should act on the information without appropriate specific advice for your particular circumstances. Ben Law is a former financial advisor but is no longer licensed and cannot and will not give you specific or personal advice in this article. The Financial Bloke Group Pty Ltd accepts no responsibility for any loss or damage occasioned by any person acting or refraining from action as a result of reliance on the information in this article.