The Wise Investor
fear, and ignorance. First, let's take greed.
We all want things we don't have. This is natural, and
the force of desire is the motivation the drives growth,
achievement and success. However, the wise investor is
always careful not to let greed control her thinking.
Many people fail financially because of greed. They
invest in high-risk investments, in the hope of gaining high
returns. Although some investments may succeed, these
investors will keep pushing for more and more money, until
one day they loose the lot.
Greedy investors are not prepared to spend money
maintaining their assets, and keeping them in good working
In their desire to keep every cent for themselves, they
neglect the proper care of their assets, and loose far more
than the maintenance cost as the value of their assets
Greedy investors always demand the highest prices when
they sell assets. Because of this, they take a very long time
to sell, and usually loose more in lost opportunities and lost
income than they gain from the slightly higher price. An
investor waiting to sell an empty rental property, for
example, should take into account the income that she is
loosing each month that the property remains unsold.
Greedy people also loose their money in every boom in
prices. When the price of shares or property rises, the
greedy refuse to sell.
Higher and higher the prices rise, often to ridiculous
heights, and still they will not sell. They wait for just a little
more profit, then just a little more after that.
Finally, everyone sells at once, the price crashes, and the
greedy are left holding assets worth half their previous
value. A greedy investor cannot bear the thought of loosing
money on an investment. When she has a bad investment,
she holds on to it, refusing to sell, in the vain hope that it will
recover its value.
Inevitably, the value declines even more, and her loss is