Life lessons to improve your investment outcomes: 'It's not a game for sissies'
Paula Luckhoff | Personalities impact investments. Veteran stockbroker David Shapiro has advice on dealing with uncertain times on The Money Show.
Your personal traits will influence your ability to deal with pressure and uncertainty, and no less so when it comes to investing.
That's why stockbrokers need to be able to handle clients' personalities much like psychologists says David Shapiro, Deputy Chairperson of Sasfin Securities.
And the volatility in the current market will test the mettle of any nervous investor.
We're going through an extremely difficult period now. We hit a high in global markets on the 1st of January and the three or four months that followed, the markets have been taken down by a whole lot of factors.David Shapiro, Deputy chair - Sasfin Securities
We've got problems in China, the US Fed worries about inflation, and we've got a war in Ukraine so people are entitled to feel a little insecure.David Shapiro, Deputy chair - Sasfin Securities
It's the way that people respond during these periods that actually defines their success, or not... You have to learn to get through these times.David Shapiro, Deputy chair - Sasfin Securities
Sometimes the best response is no response, comments Whitfield.
'Stay in the market', affirms Shapiro.
Invariably, over the last twenty or thirty years or so, the best response I think generally has been 'no response' when it comes to an inflection point like we're feeling at the moment.Bruce Whitfield, The Money Show host
If you go back in time and you look at how the market has performed, the chart goes from the bottom left hand to the top right hand! (with a lot of ups and downs along the way)David Shapiro, Deputy chair - Sasfin Securities
We've got to understand the problems, but you've got to talk people through... these are the businesses in which we're invested and they're still doing very well... What's not fine at the moment is that markets are very volatile and uncertain.David Shapiro, Deputy chair - Sasfin Securities
Shapiro has around five decades of experience helping people build wealth and understand what the risks are.
He shares five life lessons that can improve your investment outcomes:
1. Get on the right bus (if you catch a bus to Cape Town and your destination is Durban, no matter how long you stay on the bus you’ll never reach Durban)
2. Take your losses quickly, your profits slowly
3. If you look back on the market with regret, you’ll die of remorse
4. Do the research (hope and prayer are great for church or shul – not for the market)
5. When in doubt, stay out (you don’t have to be fully invested all the time)
Listen to the full conversation in the audio clip below:
This article first appeared on CapeTalk : Life lessons to improve your investment outcomes: 'It's not a game for sissies'