Investment and love
There is an opinion that an investment portfolio should be chosen in the same way as a partner in a relationship. That is, you will not succeed if you do not first define what you want, do not set a goal.
Some experts agree on this: in investments, as in relationships, there are about three main strategies. And first you choose one, and then you combine different strategies depending on the situation.
The three main strategies are these:
• Passion (balanced risky investment portfolio)
• Proximity (protective assets)
• Long-term liabilities (investments in long-term investment products)
1. Passion. This strategy, for example, was chosen by John Templeton. He started by borrowing money in 1939 and investing in 100 companies that were on the verge of bankruptcy. At the same time, he did not spend more than a hundred dollars per share. The strategy paid off: all but four of the companies were sold by John Templeton at a large profit. He followed this investment strategy all his life and achieved so much success that Queen Elizabeth II knighted him - for his financial and philanthropic efforts.
2. Proximity. This was the strategy Philip Fisher chose. His methods and books are actively studied by investment professionals. Philip Fisher was involved in network marketing and used his extensive contacts to get the most information about growing companies. He invested in those whose high growth potential was confirmed this way. He held stocks for a long time, now he is called the father of the "buy-and-hold" investment approach.
3. Long-term liabilities. This is, of course, Warren Buffett's strategy. He expected to hold forever virtually everything he ever bought. He was sure: if the choice is really right - you will never part your ways. With shares, of course.
At different times and in changing circumstances, any of the strategies can work. It depends on what you are counting on when you start investing. As in relationships, feelings are appropriate here, but reason should not be dismissed in any situation. The one who can wait wins in investing. In love too, though 😊