Thinking About the Markets in 2014
As a trader or investor, your brain and your way of thinking is your most valuable asset. Regardless of which instrument or security you trade, it is important to open your mind to all trading opportunities available to you. People tend to service their cars every few thousand kilometres, they refurbish houses and format mobile phones or computers after some time. Likewise, your brain needs to be rewired every so often, so that you see opportunities and filter out the noise in markets. The greatest risk in this business is falling behind in your way of thinking.
Traders need to mix with the best and talk with the best to become and remain successful. Some might find solace in being isolated, but this is only temporary. The market is a collection of buyers and sellers, each with personalities, thoughts and emotions. Millions of traders participate every single day in markets. It doesn’t matter if you have been trading over a lifetime or just about to enter the market for your first time. Your way of thinking will dictate your success. Your way of thinking will give you the edge over the thousands of other traders in the market place who want your money.
No one knows exactly where markets will go but we can put together some sensible assumptions and from that, find where the risks and rewards are this year. You should be aware of this when reading market forecasts – there will never be a forecaster who predicts outcomes perfectly over a period of time. Analysts who believe their own numbers blindly are either fooling themselves or lying to you. Experienced traders will most certainly agree with this. Some might get lucky over a period of time but most will eventually blow up.
Consider this. The most successful traders, analysts, brokers and investors in the world are those who have a philosophy, a system by which they base their decisions. If you open up the BRW Rich List and skim through the 100 richest people in Australia, you will see that most have built their wealth through their way of thinking – being able to seize opportunity while balancing risk. For every 100 people on the BRW Rich List there will be millions of others who have attempted the same business outcome and failed. The difference between the winner and loser is in their way of thinking.
The greatest investment you will make in 2014 will be in improving your market knowledge. When was the last time you actually invested in your education as a trader? Think of all the time and money you spent in 2013 and then write down the amount of time and money you spent educating yourself. How much time or money did you spend on housing, food, clothing, bills, entertainment etc compared to the investment you made on improving your skills as a trader? Many will realise that they have under invested in themselves. It is time to start taking advantage of the fantastic opportunities which will present themselves in 2014.
We want to remind you that in the Chinese zodiac 2014 is the year of the horse. Horses are born to either race or travel and no matter how integrated they seem to be, a horse’s inner self remains powerfully rebellious. They are open to challenging the status quo and have boundless counts of energy and ambition. Horses are generally considered in Chinese astrology as being hot blooded and impatient but also gifted and intelligent.
With that in mind, ask yourself what type of horse do you plan to be in 2014? The type that is quick to act and slow to listen, bolting too hard without considering that pace of the race of challenges ahead, or will you be the horse that is sensible and able to contain their energy with the aim of finishing first among the pack as a champion? By improving your market knowledge, you will be in a position to make the sensible, considered decisions which will lead to a highly successful 2014.
Category: Investing
