Emotional Stability

There are many success stories of millionaires who had accumulated their fortunes by investing in stocks that are being told. Perhaps we can never deny the fact that there are just people who have all the luck when it comes to investing. Many have tried doing it but have found the uncertainty of the trade too horrible for their own good. Many sad tales are told of stock market failures who have succumbed to nervous breakdown because of too much stress or of suicide cases caused by too much investment losses.

It is no wonder then that only a handful of investment specialist are considered as gurus of the trade not because they are lucky, but because they have the emotional toughness to withstand it out. They did not employ such tactics as trying to predict the market ups and downs. They simply had the guts to stick to it even as others are going out in dismay. When some stock market investors are going to the media to air their panic, these people did not allow their emotions to swing them off their intended investment paths. These gurus stress the importance of ignoring the mayhem and sticking to a solid investment strategy to get you there.

For example James O'Shaughnessy, a wall street celebrity, has been taking pot shots from the media for his intense focus on non-tech stocks while the rest of the world are getting techy. While this so called tech boom was going on, his stocks performed poorly. But sticking to his investment made him avoid the tech bust that followed. Today, his RBC US Growth Fund has outgrown S & P which has been going on yearly for the past seven years or so.

There is also an investor who was brave enough too stuck to his investments on two tobacco companies that were experiencing turmoil in the face of lawsuit concerns and discomforting fiasco from its chief executive officer. He picked up shares that were dropped by panicked investors. By sticking to his belief that these shares still have values, he finished up gaining a lot while other investors lost proportionately. In fact, he advises would-be investors to buy during a crisis instead of selling.

Many investors out there are sticking to their guts in the belief that financial storms have a way of ending spectacularly for them. They are the ones who are proving that mental toughness above all is more necessary in the investment world, than mere technical skills alone. It does not mean however that you can trade in the stock market on pure guts alone for you will need a lot of knowledge to understand the business. But once acquired, the motivation to stay on track is a rare commodity to many. They became too focused on stock prices surging up and down instead of knowing its real value. While technical knowledge is very important, the will to do something you believe in is the real deal.