Lessons on investing do not only come from investing manuals, investment advisers, or how-to guides. Sometimes, the best investing lessons come from unexpected places. In this case, the book by author Daniel Coyle teaches us the lessons. In his book, The Little Book of Talent, he shares 52 tips for improving your skills. Many of these tips apply to becoming a better person but there are a few that can apply to becoming a better investor. Here are three of those tips.
Tip #46 Don’t Waste Time Trying to Break Bad Habits. Instead, Build New Ones
If you would like to become a good investor, you should learn to pay attention to your emotions. Once you have dialed in on those emotions, it is important to evaluate them in light of rational information. As human beings, our natural habits can cause us to be emotional investors. Instead of trying to break the habit of giving in to your emotions, build a new habit in which you add rational arguments. Look at the logic of investing in a specific stock or bond. Then make a decision not based on simply emotion, but rooted in logic as well.
Tip #1 Stare at Who You Want to Become
To become a better investor, study those who are doing what you want to do. This first tip would suggest that you find a mentor or an investment manager with whom you can have candid conversations. Spend some time talking about the markets and learn the why behind the how. Not only will it make you a better investor, but it will also help you understand why your portfolio is invested the way it is.
Tip #12 Pick a High-Quality Teacher or Coach
And finally, even though you may learn what you need to know from an investment manager or mentor, you might not want to implement on your own. In this case, choose a high-quality teacher that can explain simply to you not only what they do, but also take the effort from your hands. This tip requires you to truly evaluate the person with whom you decide to work. Pay attention to how they treat you as a potential client and ask for references from current clients.
The Little Book of Talent is a great read. With 52 short lessons, you will no doubt find tips for success in your life and if you pay attention; you might also become a better investor along the way.