I know Manny Pacqiuao has been talked a lot lately and there have been so many issues and views that have been thrown out here and there. This post is really not about defending a particular side but rather throughout all of this I saw some key learnings that we as investors can learn and use to better our trading and investing. As always, the heart of my website is to empower more and more Filipinos to take advantage of this growing economy and find ways to further their lives and earn.
We all know that this issue started after Manny Pacquiao’s interview and the comments that he made from his Bible based stand about the LGBT community. But more than that I believe that there are snippets from what happened in the past few days that we can draw investment principles from.
1. Stand by your conviction
Similar to what Manny Pacquiao did, he stood by what he believed was in the Bible.
The same is true with investing and trading. Money is made when you stand and follow what you believe in and the strategy that you craft based on proper investing and trading principles. Sometimes this may not be the most popular decision, sometimes it may be against the flow or down right people may not agree with you. But as you look at the investing legends like Warren Buffet, George Soros, Peter Lynch, etc. They all had their own convictions that at most cases all contradicted one another and most of the market in general. Because investing is never really about following what your friend or your barber tells you. Investing should be personal and intentional and something that you forge based on who you are and what your skill set is.
If you are into buying and accumulating good stocks at cheap prices better know a lot about the company, its growth, profitability and its ability to rock in years to come. Then that’s when you come in and buy when your fundamental analysis tells you the stock is cheap already. That’s how money is made in investing! While if you are trading, by either mastering the art of positioning well or trading quick, you must use technical analysis. I am under the conviction that trading without the use of charts is like sailing without a GPS and without direction. Without charts it is hard to have a reference on where you are in the grand scheme of things.
Build your foundation, practice, gain the experience and until you get to stand on your own conviction. Don’t chase after earnings, chase after building your own trading conviction and that’s when profits will come.
2. Admit your mistake and bounce back
Aside from my wife, I believe no human is perfect. We all make mistake and we fall short from time to time. Manny Pacquiao apologised for the words that he said on air and moved on and is currently doing his best to bounce back from it.
The same is true with investing. As we all know the market dropped massively for almost 8 months starting from last year. For some of us, there may be times that we have bought the wrong stock and just held on to it because we we’re scared of actualizing the loss. My encouragement to you is that if you are trading you must respect the cut loss signals that the charts are telling you. They are there to protect you so that to minimize your losses and at the same time maximize the possible gains that you have. So if you may have missed out from minimizing your loss from the last drop in the market. Don’t lose heart, bounce back from it, learn from your mistakes and create a strategy so you never do it again. Investing in the market is not about playing a perfect game but rather earning well when you are right, minimzing your loss when you are wrong and moving forward from every trade that you make. Also if you are a long term investor and see your stocks drop significant amounts and then your emotions are telling you to sell already, don’t follow that. Emotions will make you lose money in the market. Go back to your fundamentals, go back to your strategy and see if in spite of the drop if the stock is worth holding on to or not.
Don’t let a series of losing trades define who you are. Who you are is not defined by what you do in the outside but rather who you are in the inside. So just continue to push forward and craft your on style and bounce back!
I hope this helps you in your trades. As my heart is to see more Filipinos earn well and invest well. As I believe that if more Filipinos are investing we make our economy bigger and better than where it is now. I can’t believe I’m writng again for the the 5th straight day! This is a resurgence in blogging for me. I hope I keep this up and I get to write even more. Have a great weekend ahead, for those who signed up for tomorrow’s Stock Smart Seminar I am looking forward to see you all!
I’m excited to share my latest book, Where Should You Invest? This will answer one of the biggest questions on the what, where and when you should invest on. I will also tackle the concept that there are certain investments that work well with others and some investments that don’t work well at a certain investment phases.
This is aimed to help investors have a holistic sense on how they can grow, maximize, and preserve their wealth!(Stock Smarts Book 4 is also coming this year)
To order: http://goo.gl/forms/AaciOAg92H
(Picture of Manny Pacquiao from google and skysports.com)