We need to be clear about why we are investing. Otherwise, the smallest perturbation – a market up move or down move, or an opinion by an expert with tweet diarrhoea can make us question our choice.

1. Individuality

Once we create an investment plan suited for us, we need to stick to it, rain or shine. Due to the ups and downs of life, we may not invest regularly. We must keep track of the missed investments and make up for them late

2. Discipline

We must recognise that any choice we make in life or personal finance will have an associated cost. Sometimes the cost is immediately apparent, and sometimes it may take decades to reveal itself.

3. Balance/composure

he most important quality, in our opinion, is humility. We must recognise that there are a zillion ways to go from point A to point B, and ours is just one of them. It is rather immature to assume that what we are doing or our choices are the best.

4. Humility

Published: January 14, 2022 at 7:00 amHere are four qualities needed to become a successful investor. Thankfully we can develop these qualities in time. We neither need to be smart nor intelligent to succeed in money management.1. Individuality:&nbsp; We need to be clear about why we are investing. Otherwise, the smallest perturbation – a market up move or down move, or an opinion by an expert with tweet diarrhoea can make us question our choices.This is possible only we understand what we need without worrying about what others are doing. This is the first step in personal money management. Sadly many of us buy first and think later.2. Discipline: Once we create an investment plan suited for us, we need to stick to it, rain or shine. Due to the ups and downs of life, we may not invest regularly. We must keep track of the missed investments and make up for them later. Also, see: <a href="https://freefincal.com/how-do-i-become-a-disciplined-investor/" dir="ltr">How do I become a disciplined investor?</a>Discipline is the fuel with which all financial plans move forward. Even less optimal investment choices can be made to look good with discipline.<div><label for="mailster-email-7" dir="ltr"> Build a complete financial plan with our <a href="https://freefincal.com/robo-advisory-software-free-download/" dir="ltr">Robo Advisory Tool</a>. More than 700 investors and financial advisors use it!</label></div><div><label for="mailster-email-7" dir="ltr"> Get free money management solutions delivered to your mailbox! Subscribe to get posts via email! (Subscribers get exclusive perks!) *</label></div>3. Balance/composure: We must recognise that any choice we make in life or personal finance will have an associated cost. Sometimes the cost is immediately apparent, and sometimes it may take decades to reveal itself.We must take the time to find out the cost or implications of our actions. For example, a home loan almost always means a lower retirement corpus. Wanting guaranteed returns almost always means an inability to fight inflation.We can choose ‘expensive’ provided we appreciate what they imply and own up to them. We need a sense of balance to weigh the pros and cons of a choice without bias.A sense of balance is also required to gauge if a risk is reasonable or not. All investment choices come with risk without exceptions. It could be a bond purchased from the government, an employee stock option, NPS or EPF, or a mutual fund.Do we appreciate at least the major risks involved? How reasonable is taking on such a risk? For example, the risk associated with an equity fund is unreasonable for the short term and reasonable (that is manageable) over the long term.We do not know what our future portfolio return would be, but we can ascertain “where we are” in our journey provided we have the composure to remind ourselves that we are investing in a way that is suitable for us.4. Humility: The most important quality, in our opinion, is humility. We must recognise that there are a zillion ways to go from point A to point B, and ours is just one of them. It is rather immature to assume that what we are doing or our choices are the best.If there is one thing that I have learnt over all these years of investing and researching finance, it is this: nothing stays on top forever; nothing will work all the time.The market is an intractable beast that gives us joy and misery as it pleases. No one can claim to have conquered it or understood it. Equanimity to treat gain and loss on the same footing and the humility to recognise the role of luck and circumstances is most important.We need to stop feeling superior about our investment choices. A passive investor claiming his choices are the best is just as misguided as an active investor who claims the same. We don’t know what will work in future. We make a choice and manage the consequences.Humility also helps us conquer regret&nbsp;if&nbsp;we remember that things don’t always go to plan in the market. If our choices don’t work out, we must have the balance to get rid of them and move on quickly.As far as our thinking takes us, a combination of composure, discipline and humility can make us successful, provided the milestones are based on personal requirements. Patience is a crucial quality, too, but blind patience is dangerous. The above qualities help us be patient with a purpose.It is unlikely that everyone is born with all these qualities. Thankfully we can learn if we allow life to teach us.<div>Do share if you found this useful</div><h3>About The Author</h3><img src="https://freefincal.com/wp-content/uploads/2019/11/Pattabiraman-author-freefincal-article-bottom.webp" alt="Pattabiraman editor freefincal" width="182" height="256"><div dir="ltr">Dr <a href="https://freefincal.com/pattabiraman/" rel="noopener" dir="ltr">M. Pattabiraman</a>(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over nine years of experience publishing news analysis, research and financial product development. Connect with him via <a href="https://twitter.com/pattufreefincal" rel="noopener noreferrer" dir="ltr">Twitter</a> or <a href="https://www.linkedin.com/in/pattabiraman-m-29376a7/" dir="ltr">Linkedin</a> or<a href="https://www.youtube.com/channel/UCf5H6aT6NzCQES8OJIhciTw?sub_confirmation=1" dir="ltr"> YouTube</a>. Pattabiraman has co-authored three print books: (1) <a href="https://www.amazon.in/You-Can-Rich-Too-Investing/dp/9384061379" dir="ltr">You can be rich too with goal-based investing</a> (CNBC TV18) for DIY investors. (2) <a href="https://www.amazon.in/Gamechanger-Forget-Start-ups-Corporate-Still/dp/B0716ZJ89V/" rel="noopener noreferrer" dir="ltr">Gamechanger</a> for young earners. (3) <a href="https://freefincal.com/get-my-new-book-for-kids-chinchu-gets-a-superpower/" dir="ltr">Chinchu Gets a Superpower!</a> for kids. He has also written seven other <a href="https://freefincal.com/ebooks/" dir="ltr">free e-books</a> on various money management topics. He is a patron and co-founder of “<a href="https://freefincal.com/fee-only-india-launch-movement-investors-advisors/" dir="ltr">Fee-only India</a>,” an organisation to promote unbiased, commission-free investment advice.</div><div dir="ltr"> Our flagship course! <a href="https://freefincal.com/gms-course-faq/" dir="ltr">Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions!</a> ⇐ More than 2700 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter what the market condition is!! Watch the first lecture for free!&nbsp; One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! 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What is this book about?&nbsp;As parents, if we had to groom one ability in our children that is key not only to money management and investing but for any aspect of life, what would it be? My answer:&nbsp;Sound Decision Making. So in this book, we meet Chinchu, who is about to turn 10. What he wants for his birthday and how his parent’s plan for it and teach him several key ideas of decision making and money management is the narrative. What readers say!</div><figure><img src="https://freefincal.com/wp-content/uploads/2021/02/For-bottom-Feedback-from-a-young-reader-after-reading-Chinchu-gets-a-superpower.webp" alt="Feedback from a young reader after reading Chinchu gets a Superpower (small version)" width="644" height="208"><figcaption dir="auto">Feedback from a young reader after reading Chinchu gets a Superpower!</figcaption></figure><BLOCKQUOTE>Must-read book even for adults! This is something that every parent should teach their kids right from their young age. 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I came across an neat article which actually gives a quick reality check which every investor must have in the process of building wealth.

Here are four qualities needed to become a successful investor. Thankfully we can develop these qualities in time. We neither need to be smart nor

personaldevelopment

Personal Development

moneyandinvestments

Money & Investments

business

Business

Published: January 14, 2022 at 7:00 am

Here are four qualities needed to become a successful investor. Thankfully we can develop these qualities in time. We neither need to be smart nor intelligent to succeed in money management.

1. Individuality:  We need to be clear about why we are investing. Otherwise, the smallest perturbation – a market up move or down move, or an opinion by an expert with tweet diarrhoea can make us question our choices.

This is possible only we understand what we need without worrying about what others are doing. This is the first step in personal money management. Sadly many of us buy first and think later.

2. Discipline: Once we create an investment plan suited for us, we need to stick to it, rain or shine. Due to the ups and downs of life, we may not invest regularly. We must keep track of the missed investments and make up for them later. Also, see: <a href="https://freefincal.com/how-do-i-become-a-disciplined-investor/">How do I become a disciplined investor? </a>

Discipline is the fuel with which all financial plans move forward. Even less optimal investment choices can be made to look good with discipline.

3. Balance/composure: We must recognise that any choice we make in life or personal finance will have an associated cost. Sometimes the cost is immediately apparent, and sometimes it may take decades to reveal itself.

We must take the time to find out the cost or implications of our actions. For example, a home loan almost always means a lower retirement corpus. Wanting guaranteed returns almost always means an inability to fight inflation.

We can choose ‘expensive’ provided we appreciate what they imply and own up to them. We need a sense of balance to weigh the pros and cons of a choice without bias.

A sense of balance is also required to gauge if a risk is reasonable or not. All investment choices come with risk without exceptions. It could be a bond purchased from the government, an employee stock option, NPS or EPF, or a mutual fund.

Do we appreciate at least the major risks involved? How reasonable is taking on such a risk? For example, the risk associated with an equity fund is unreasonable for the short term and reasonable (that is manageable) over the long term.

We do not know what our future portfolio return would be, but we can ascertain “where we are” in our journey provided we have the composure to remind ourselves that we are investing in a way that is suitable for us .

4. Humility: The most important quality, in our opinion, is humility. We must recognise that there are a zillion ways to go from point A to point B, and ours is just one of them. It is rather immature to assume that what we are doing or our choices are the best.

If there is one thing that I have learnt over all these years of investing and researching finance, it is this: nothing stays on top forever; nothing will work all the time.

The market is an intractable beast that gives us joy and misery as it pleases. No one can claim to have conquered it or understood it. Equanimity to treat gain and loss on the same footing and the humility to recognise the role of luck and circumstances is most important.

We need to stop feeling superior about our investment choices. A passive investor claiming his choices are the best is just as misguided as an active investor who claims the same. We don’t know what will work in future. We make a choice and manage the consequences.

Humility also helps us conquer regret if  we remember that things don’t always go to plan in the market. If our choices don’t work out, we must have the balance to get rid of them and move on quickly.

As far as our thinking takes us, a combination of composure, discipline and humility can make us successful, provided the milestones are based on personal requirements. Patience is a crucial quality, too, but blind patience is dangerous. The above qualities help us be patient with a purpose.

It is unlikely that everyone is born with all these qualities. Thankfully we can learn if we allow life to teach us.

One-time payment! No recurring fees! Life-long access to videos!

One-time payment! No recurring fees! Life-long access to videos!

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You Can Be Rich Too with Goal-Based Investing

Your Ultimate Guide to Travel

Four qualities that define a successful investor

1. Individuality

2. Discipline

3. Balance/composure

4. Humility

S.Kishore Kumar's ideas are part of this journey:

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