Monday 28 January 2019

Certainty is for the mediocre

"Think about the most meaningful thing you have ever done. I would wager that it took a measure of risk, uncertainty and hard work to achieve. In this, as with all risk, comes a valuable lesson: to strive for certainty is to doom oneself to mediocrity."

This applies to many areas of life but especially investing. When we invest we crave certainty. We want to know the whichever shares we buy will definitely without shadow of a doubt "go up". And they must go up in a straight line. So when this doesn't happen and share prices jump around, we panic and do stupid things (like liquidating and holding on to cash... just waiting to catch the bottom of the market). We must embrace uncertainty... even celebrate it.

I am trying not to be a groupie but the Behavioural Investor sure has some wise words in it!

Here is the rest of Daniel Crosby's favourite paragraph in his book:

Here is the original tweet.