Three Big Enemies Of Investing
1) Dissonance (Not Knowing the Reason / Goal Behind Investing)
This is also Mindless Investing
It is important to have a clear Investing Goal and Purpose without which the journey has no traction
2) Anxiety : Anxiety appears because of lack of knowledge and conviction.
Every investor needs to be educated about the process of investing
Equity investing risk only means Volatility & Notional Losses at times
Equity Returns eventually revert to the mean & compounds over time
Credit Risk can be more painful than Equity Market Risk
This is because while Credit Risk can leave behind a Permanent Scar on the Portfolio, Market Risk is more a temporary in nature
3) Dissatisfaction : While at one point an investor is fearful
But ironically once the investment starts working in his favour, he or she becomes greedy and demands soar
He or she loses focus on the Goal and Purpose and instead compares his or her returns with those of other funds which may have got higher Returns after having traversed a more volatile path.
We tend to discard the path and look at the results for comparison and feel unnecessarily dissatisfied
So dissatisfaction, greed, comparison and losing focus on larger Purpose is perhaps the biggest of all the enemies of Investing
Thus remember the 3 Enemies of the Investment Process and keep them at bay, Away At a Distance