Responsible Investing

To the ​MILLIONS of individuals who opened up brokerage accounts during the pandemic.

Please read before placing another trade.

Investing in the stock market is thrilling. There’s a certain rush you experience when you have your money in the market. The ups will make you feel like a rockstar and the downs make you wish you had the option to wind back the clock to a point so you can slap yourself for even thinking about it. Individuals need to be psychologically equipped and prepared for the ups, downs and zig zags of the market, especially done with pure speculation. Keep in mind, the majority of investment mistakes are driven by the result of ​emotional sabotage​. And it isn’t always our conscious emotions that gets us in trouble, but the hidden ones. The ones that are engraved into our subconscious. It is wrapped into our attitudes, beliefs, feelings, and biases. It is our upbringing and past experiences – good and bad – that impacts our paradigm toward money. So before getting yourself in trouble, ask yourself some of the following questions before investing:

  • How do you make investment decisions?
  • Do you ever consider how each investment interacts with the other investments in terms of risk?
  • How would you feel if you are down 10%, 20%, 30%, 40%, 50%?
  • At what point do you sell?
  • Do you need the money at a certain point in time?
  • If you can’t accept the loss, are you ok with locking up your money as you “wait/hope” until you break even?
  • Will you be mentally and financially stable to accept if it doesn’t recover?
  • Are you going to allow days that you are down to have an impact on your mood? How will that affect other areas in your life?
  • What is the purpose for your money?

These are several questions to think over to mentally prepare before participating in the stock market. Try AVOIDING making impulsive decisions, as we all know, are very easy to make and very challenging to come back from. For people who have made money in the stock market especially during Covids wild run, congratulations! You took action and it paid off. However, don’t get caught up with having a “whatever I touch turns into gold” attitude. These are people who seem to think they have the midas touch and you’re lucky to be talking to them. Take it easy pal. A big short-term win is exciting and fun, but it’s also dangerous. It creates the desire to do it again but this time your overconfident attitude leads to inappropriate risk taking and catastrophic results. Many people have experienced this leading up to the tech boom in 1999 and the financial crisis in 2008.

To avoid any emotional missteps during your investment journey, it’s best ​to invest over a period of time, not in a single point of time​. Some principles to follow to having a sustainable, successful approach for​ long-term ​investing include the following:

  • Understanding, taking on and managing risk responsibly.
  • Having a disciplined, systematic, unbiased, unemotional portfolio.
  • Being psychologically prepared.
  • Diversification.

The stock market can seem complex. However, the most advanced concepts can be broken into a few simple principles including risk management, diversification, disciplined and consistent investment process and most importantly, emotional discipline.

Watching CNBC or Bloomberg or listening to these so-called money professionals do a great job perpetuating a myth, that if you’re smart enough, you can predict the market moves and avoid its downfalls. In reality, no one can time the market. That is why, it’s wise to invest over a period of time, not in a single point in time. Make it easy for yourself, for your loved ones and for your future.

“The thing to do is to keep your mind when the world around you is losing theirs”

– Warren Buffet

Change Starts with a Single Step

What are you waiting for? It’s time to invest in your future.

Important Notice:

 

You are now leaving the Bamboo Investment Management website and will be entering the Charles Schwab & Co., Inc. (“Schwab”) website. 


Schwab is a registered broker-dealer, and is not affiliated with Bamboo Investment Management or any advisor(s) whose name(s) appears on this Website. Bamboo Investment Management is/are independently owned and operated. Schwab has agreements with Bamboo Investment Management under which Schwab provides Bamboo Investment Management with services related to your account. Schwab does not review the Bamboo Investment Management Website(s), and makes no representation regarding the content of the Website(s). The information contained in the Bamboo Investment Management Website should not be considered to be either a recommendation by Schwab or a solicitation of any offer to purchase or sell any securities.

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