25 July 2011

Self Discipline Crucial to Your Investment

There are lots and lots of people who aim to achieve financial freedom during their middle age. However, not many people are able to do so. There are several reasons that I could think of, one of the reasons is 'not enough self discipline'.

I must admit that I also do not have a strong self-discipline in myself. However, I have improved my self-discipline in investing over the years as I always believe in myself that I could able to achieve at least 20%-30% of annualized return constantly. If we keep the pace at 26% per annum, means that we are able to increase 100% of our fortune in 3 years and 10x of our wealth in 10 years. It is quite amazing as we must change our mindset to that direction, that investment can really allow you to earn more with calculated risk. It is always wise that you are able to get a coach to teach you on investment, especially when you have no direction in your investment journey.

Over the year, self-discipline plays a very major part in my investment decision making process. Besides that investment philosophy, you must allocate your time to do the research on the investment for at least 1 hour a day, so that you can catch up the new term / information from internet or from the local environment. Take for example, if we do not know about 'Google +', then we might not be able to participate it and explore the business opportunity that Google has brought to us. Of course, you can also expand your circle of competence to bigger circle (or more sectors) so that you are able to find out more opportunity in investing.
Recently AirAsia tied up with Japan Airlines gives us the opportunity to see whether it is able to cope with the new business model to expand it to Japan market. Without doing research, we could not able to find out the risk and possible return from the market.

If you do not have time to do your own research, you could also just restrict yourself to diversify your investment portfolio in those blue chip stock and learn how they are doing their business. By getting more familiar in their business, then only you can put big buck of your money there. Please always remember that invest in the stock market is to be public listed company's share holders to enjoy the benefit of grow it brings to you.

Last but not least, always review your investment result and make an appropriate adjustment if particular investment cannot bring you any big profits. You may made a wrong choice in wrong timing or wrong stock. You must always believe that you can make money in your investment.

Good Luck!

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