The 13 Characteristics of a Good Investor

[audreyh1]

I made the mistake of watching a couple of days ago. About about 2 minutes into me watching it, Rick Santelli lost his ever loving mind and was YELLING and arguing with Scott Wapner. I couldn't get the TV turned off fast enough!

Yes, it totally turned into shouting matches many years ago.

Rick Santelli started his yelling shtick back in 2008 after Jim Cramer became famous for his on-air “They [the Federal Reserve et. al.] don’t know nothing!” rant, which was shocking at the time - especially that he was right! After that we were treated to a lot of dumb Rick Santelli rants. Too bad it continues.

Can’t stand watching live anymore. I may watch a Becky Quick or Sam Shepard video interview of someone whom I care what they have to say.

 

[Koolau]

Those 13 commandments, would of been nice to have 45 years ago when I started out investing.

+1

Not until I was almost 40 did I figure out that following those type of "commandments" would be best for me. Fortunately there was still enough runway for me to gain tremendous benefit from them.

Yes, fortunately, time was on our side. I've mentioned before, that at LEAST I was a good savor. I think that may be Commandment "0"

I'll have to admit, though, back in the day, I'd probably have ignored the 13 commandments as much as the original 10 (at least in my heart - I'm guilty of ALL of them.)

Men and nations do act wisely when they have exhausted all the other possibilities. This could have been spoken of me (emphasis on "me" not "could" - but YMMV.)

 

[OldShooter]

... at LEAST I was a good saver. ...

In the preface to one of the investing books, maybe Bernstein, the author says something like this: "If you can't save, you are wasting your time reading this book. The best financial advice I can give you is to return this book to where you bought it and get your money back."

I think that saving is Commandment #0.

 

[target2019]

List adapted from somewhere:

1. Pay credit card balances in full each month.
2. Save 20% of your income.
3. Max your 401(K) or equivalent employee employee contribution plan.
4. Maximize tax-advantaged savings accounts (Roth-IRA, SEP-IRA, 529 plans).
5. Buy diversified mutual funds and ETFs. Own the entire market, not a few companies.
6. Pay attention to all fees and avoid actively managed funds when possible.
7. Never buy or sell individual stocks without a long-term plan.
8. Establish an Asset Allocation (AA) that lets you sleep at night.
9. Make any Financial Advisor (FA) commit to a fiduciary standard.
10. Promote social insurance programs to help those in need.

 

[F.I.R.E User]

Ignore Cryptocurrencies and stop watching news to add.

 

[RobbieB]

I especially like the ignores at the end.

 

[travelover]

Thirteen seems so unlucky. Luck is important to an investor.

 

[Major Tom]

I think most of us, when younger, felt as if we needed to be actively doing something in order to make money with the markets. It must have been a holdover from work, in which we did have to be actively doing something in order to get our money. Certainly, there are members here who actively manage their portfolios, and do it capably. For many of us though, we are better off setting an AA and, other than the very occasional rebalancing, staying well away.

That lesson took me a few years to learn but, luckily, I learned it fairly early on. It really is quite a marvel how I am able to lounge around in my pajamas with my cat - and make money. I could almost feel guilty about the whole thing.

Almost...............

 

[RobbieB]

I've said this so many times now that I gonna copy and paste.

All I needed to know about finance I learned from Pops. He was a man of few words.

1) You can make a million a year but if you spend a million a year you aren't going to have anything, so save some. These savings while small but growing will enable you to not buy furniture and appliances on credit.

2) When you've saved enough for a down payment, buy a house. The difference between rent and mortgage is small and the government helps you with interest and you keep building equity. The mortgage should be your only debt.

3) When your savings have recovered from the down payment and the move in expenses, start buying stocks. That's where you'll make the most.

It worked for Pops and it worked for me. I didn't read a lot of financial books, just went by what my father taught me.

 

[Markola]

^^^^Word

 

[FIREarly]

I'm sending this to my sons. Both have small Roths despite being only 18 and 20 with part time jobs. The younger one saves more - but tends to think like a daytrader. But he *sometimes* listens to mom.

This video from CNBC has some helpful info to share with your kids:
https://youtu.be/KTR6jT6LQLs

The video forgot to mention, invest in Dogecoin! JK JK JK!
If you don't know Dogecoin, ask Elon Musk!

 

[tuckeverlasting]

The Bogleheads's investing advice has served me very well---all given generously with a glad heart, even as here. And the motto "Keep it Simple" is useful in everyday life, too.

 

[OldShooter]

I think most of us, when younger, felt as if we needed to be actively doing something in order to make money with the markets. It must have been a holdover from work, in which we did have to be actively doing something in order to get our money. Certainly, there are members here who actively manage their portfolios, and do it capably. For many of us though, we are better off setting an AA and, other than the very occasional rebalancing, staying well away. ...

As usual, Buffett has a trenchant comment:

"Much success can be attributed to inactivity. Most investors cannot resist the temptation to constantly buy and sell. ... Lethargy bordering on sloth should remain the cornerstone of an investment style."
​

 

[TheWizard]

I honestly don't know. I see ads from Fidelity about their great smartphone app and how I can track my investments easily. I don't need to track that closely or often.

Well how do you buy more investments then?
I use the Vanguard app on my smartphone to buy more mutual fund and ETF shares from time to time.

And I have a few other apps or websites that I tend to monitor for the occasional great buying opportunity...

 

[OldShooter]

Well how do you buy more investments then? I use the Vanguard app on my smartphone to buy more mutual fund and ETF shares from time to time. And I have a few other apps or websites that I tend to monitor for the occasional great buying opportunity...

Not speaking for @jimbee, but for DW and me none of that pertains. We are fully invested with the AA we want to have and we are retired, so the only time we buy something we sell something else. This happens maybe once a year except for small trades where we need some cash. The Schwab web interface via our desktops works just fine for any of this. Re "great buying opportunities" I am not smart enough to identify them through the windshield, only in the rear view mirror. So no need to have any hurried financial dealings via our phones or tablets.

 

[jimbee]

Well how do you buy more investments then?
I use the Vanguard app on my smartphone to buy more mutual fund and ETF shares from time to time.

And I have a few other apps or websites that I tend to monitor for the occasional great buying opportunity...

Not speaking for @jimbee, but for DW and me none of that pertains. We are fully invested with the AA we want to have and we are retired, so the only time we buy something we sell something else. This happens maybe once a year except for small trades where we need some cash. The Schwab web interface via our desktops works just fine for any of this. Re "great buying opportunities" I am not smart enough to identify them through the windshield, only in the rear view mirror. So no need to have any hurried financial dealings via our phones or tablets.

Well, OldShooter pretty much described how I do it, and why I do it that way. Works for me, I have nothing to add.

 

[target2019]

Great divide between the generations. There's a gen with crypto wallet and trading apps. Another sees no reason to look (they say). Most do measure investments and wealth at periodicity of their choosing. Once a month works for us.

I do use Seeking Alpha to quickly bring up all of the tickers that interest me. That may happen once a week, or maybe in response to some talking point just read.

Used the Schwab app to deposit a check a few days ago. Every so often I randomly use the app to look at positions and transactions.