I’m curious to know: Do You Follow Through On Your Stock Ideas?
I realize that might sound ridiculous. But it’s an honest question.
Let me explain:
A lot of traders and investors spend innumerable hours on trade analysis and stock picking. It’s an area that receives enormous attention. Everyone is incredibly focused on improving their analysis, updating their education and feeling confident in their stock ideas.
But here’s the thing…
Markets are random. Completely and totally unpredictable. You’re never going to be right 100% of the time. Can you accept that?
And here’s the other thing…
If you can’t accept being wrong, how is it manifesting itself? Are you hesitating on pulling the trigger? Are you spending additional time looking at information and news articles you wouldn’t normally include in your investment process? Are you ignoring the losses in your brokerage account?
Look, we’ve all been there. (insert monkey-covering-eyes emoji)
But at some point, you have to accept you’re going to be wrong, create a plan to manage risk, and then follow-through on your stock picks.
Here’s the last thing I’ll say about following through:
Doing great analysis and taking action on it are not the same thing. A lot of analysts are afraid to take the plunge. And a lot of day traders dive in head first without ample analysis.
But if you’re reading this website… chances are you err towards the former. Now…
I’m sorry I don’t have an answer for you, but awareness is the first step. So keep an eye out for signs you might not be following through on all the hard work you put into your stock picking. If you find yourself reaching for another investment book after you’ve already read 10, well…
Maybe you shouldn’t. And that’s coming from a guy who’s read hundreds of finance books.
Maybe it’s time to follow through. Maybe it’s time to take action. And maybe it’s even time to make some mistakes in the real world and figure out how to deal with them.
By the way… as you might have guessed… the only reason I can opine so genuinely on this topic is because (naturally) it’s something I’ve struggled with myself in the past.