One of the signs that I must be getting old is that I’m often inspired to speak to young graduates concerning the \”secrets of success.\”
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The message that I deliver is dependant on two key concepts which are equally as applicable to achieving one\’s investment objectives as they are to achieving career objectives: being available to new opportunities and working exceptionally difficult to capitalize on those opportunities.
The first concept – being available to new ideas – is really a sort of retort to people who say, \”That idea am simple, I wish I had thought of it.\”
Great opportunities are constantly surrounding us, but most of us simply posess zero way to tune them in.
Think of radio waves or cellphone waves. We can’t see them or feel them. But we all know they’re there. Why? Because we\’ve devices to capture those waves and turn them into something we can comprehend – sound.
So, too, with \”opportunity waves.\” They all are around us all the time. Every event produces them, and yet so few individuals are able to tune them in, probably because the tech giants haven’t created a device to capture them.
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Luckily, you shouldn’t need such a device since your brain is already hard-wired to stay tuned opportunity waves. But, like most of the features in your smartphone, you just haven’t determined yet cooking techniques.
The savviest investors figured out long ago using that part of their brain. They know every article they read, every interview they listen to and every lecture they attend is infused with good ideas waiting to become received.
When ordinary investors listen to a speaker discuss the challenges of the inefficiencies of peak wind turbine, they try to discover which traditional energy producer is easily the most efficient. When extraordinary investors pay attention to the same speaker, they think about who is leading the brand new work on batteries that store power made in off-peak times.
When ordinary investors read a study suggesting that oil costs are sure to rise, they investigate which airlines have the best hedging strategies in position. When extraordinary investors browse the same report, they investigate which aircraft manufacturers are working on future-friendly designs that dramatically increase fuel efficiency.
And when ordinary investors arrive home to find their teenaged kids ditched their chores to video talk to their friends, they get upset and take off the kids\’ devices. Extraordinary investors also get upset and take away their kids\’ devices, but not before determining what newly discovered apps they were using and the way to invest in them.
Tuning in to these opportunities, obviously, is only the first step. After all, the old adage that \”the harder you work, the luckier you get\” is just as true in investing because it is in sports.
In order to get lucky with new investment ideas (or at least to get lucky regularly), there is no proxy for effort, and a lot of it.
In the same way that engineers work for thousands of hours on super batteries to keep power or aircraft winglets to improve fuel efficiency, investors who stumbled upon a good idea must work diligently to fulfill themselves that the idea has merit, can be monetized and it is in the hands of people both capable of bringing it to market and skilled enough to operate a business that is portable and scalable.
All the hard work in the world won’t turn mediocre investment concepts into winners. And all the good ideas in the world won’t bear fruit without the hard work necessary to translate them into actionable items.
Study the truly amazing success stories within the centuries and you’ll discover that, without exception, those remembered over time were the ones from extraordinary thinkers with extraordinary work ethics. As with yin and yang, you can’t have one without the other.
David Kaufman is president of Westcourt Capital Corp., a portfolio manager specializing in traditional and alternative asset classes and investment opportunities. He can be contacted firstname.lastname@example.org.