[ad_1] If I say I’m going to give you some advice on agriculture, you’ll probably want to question its authenticity, and you may be right. However, let me assure you that farming is more akin to investment than you’d like to believe, and offers invaluable learnings. Here’s the advice:.. Don’t shout at the crops. Don’t blame the crop for not growing fast enough… Don’t uproot the crops before they’ve had a chance to grow… Choose the plants that are suited to the soil and weather… Irrigate and fertilise. Remove the weeds… There will be good seasons and bad seasons. You can’t control the weather; you can only be prepared for it. People often make investments with false expectations. I know because I have done it often enough. When we choose an investment, be it a stock or mutual fund, it’s an act of belief, of commitment. We choose the investment, so we are responsible for it. No one chooses an investment hoping that it will make modest gains or give returns on par with the markets. Inevitably, the expectations tend to be high, and the reality for many of our investments does not meet these expectations. At this point, the natural reaction is to pass the blame on to the stocks, fund manager, or adviser. It’s human nature. However, the truth is that no matter which type of investment we make, it’s our money, and we are responsible. If we make a bad decision, it’s better to recognise it as such, understand what happened, and move on. How do we know if the decision was really bad? Often, we don’t. Investors and, in fact, the entire market, tend to go through cycles of euphoria and depression. Just as we are over-optimistic about investments in the beginning, we get over-pessimistic if they don’t meet our initial expectations. It’s easy to fall into the trap of turning pessimistic and selling our investments early. If your initial thesis of why it was a good investment still holds, keep holding it. The problem is that most of us start with more hope than reasoning, but this is a problem that should be resolved at the start, not by selling too early. Choosing investments that are not suitable to our needs is another common trait. In fact, the process of choosing investments often does not begin with the right questions. When a saver wants to know where to invest, the obvious question he asks is: ‘Which investment should I choose?’ However, it’s the wrong question. The right one is: ‘What do I want from my investments and, therefore, which type of investment should I choose?’ If the investment is wrong, then it matters little if it does well. It will still end up not serving your purpose. Of course, choosing good investments is not enough. Good investments go bad, or your needs can change. Your portfolio may require periodic rebalancing, and underperforming investments may need to be replaced to keep your portfolio healthy and suited to your needs. Finally, everything with your investments can be shipshape, but external events can still cause some problems. Isn’t it strange that investors worry about things they cannot control while ignoring the ones that they actually can? Can you influence economic growth? Wars and conflicts? Energy prices? Interest rates? No, you can’t. Can you control which investments you make and at what value? Of course, you can.It’s much better to be prepared for anything but not expect things to go smoothly. Times will be better sometimes, and sometimes they will be worse, but mostly, they will keep getting better. Our job is to focus on our investments, not the environment.(The Author CEO, VALUE RESEARCH) [ad_2] Source link Post navigation Funding Anti-racism: LA County reintroduces $100M community investment grant | News Why putting all your money in property and gold is a bad investment strategy