At some point along the way, every investor will come to a fork in the road.
There will be a new investment du jour that everybody is talking about, and you’ve got to make a decision. You know that most will fizzle out, but you also know that some will not. Some will change the world and offer investors the opportunity to change their life (My life-changing story here).
Do you go left? “Pff. I’m no sucker.” Or do you go right? “I’m going to triple my money!”
How you respond to these temptations can have enormous ramifications.
On the one hand you don’t want to be the investor who was dismissive of the internet in 1998. On the other hand you don’t want to be the investor who got swept away and bought telecom in December 1999. How do you balance this?
There are no easy answers. Investing is all about getting comfortable with regrets, of which there are many:
- Taking that stock tip
- Selling too early
- Holding on too long
- Not buying enough of a big winner
- Getting seduced by pessimism
Josh and I spoke about the investor’s dilemma and more, on this week’s What Are Your Thoughts?