Control your emotions from "summary" of The Bogleheads' Guide to Investing by Taylor Larimore,Mel Lindauer,Michael LeBoeuf
Investing can be an emotional rollercoaster. It's easy to get caught up in the excitement of a rising market or the fear of a downturn. But successful investors understand the importance of controlling their emotions when it comes to making decisions about their money. When the market is going up, it can be tempting to jump on the bandwagon and invest more money in hopes of riding the wave to even greater profits. But this kind of emotional decision-making is often driven by greed and can lead to taking on more risk than is prudent. On the other hand, when the market is falling, fear can take over and cause investors to panic and sell off their investments at a loss. By controlling your emotions, you can avoid making impulsive decisions that can harm your long-term investment goals. Instead of reacting to short-term market fluctuations, it's important to stay focused on your overall investment strategy and stick to your plan. This means not getting swept up in the latest investment fad or making drastic changes to your portfolio in response to market volatility. One way to help control your emotions is to have a clear investment plan in place. This plan should outline your financial goals, risk tolerance, and asset allocation strategy. Having a well-thought-out plan can provide a roadmap for making investment decisions and help you stay on track during turbulent market conditions. Another key aspect of controlling your emotions is to avoid constantly checking your investment portfolio. Checking your portfolio too frequently can lead to knee-jerk reactions to short-term market movements. Instead, it's important to take a long-term view of your investments and resist the urge to make changes based on day-to-day fluctuations.- Successful investing requires discipline and the ability to stay focused on your long-term goals. By controlling your emotions and sticking to your investment plan, you can increase your chances of achieving financial success in the market.
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