Patience… A new investment asset class?

by brendon on August 28, 2019

What character or way-of-being should an investor most want to master?

The answer is PATIENCE. Like an asset category that gives investors positive rates of return, investing with patience may be an investor’s greatest ally. Conversely, a lack of it could be their worst enemy.

Investing with patienceDalbar’s annual study of investor behavior reveals global investors lean toward short-term investing, expecting to hold investments for a little over three years on average. Less than a fifth of investors hold investments for at least five years. In the context of implementing a successful investment strategy, this is not investing with patience.

The tendency toward impatience is higher among younger investors. Investors ages 18 to 35 desire a minimum return of 10.2 percent but expect to hold investments on average for just one-and-a-half years. They’re the least likely to stick to an investment plan. This too does not exhibit patience.

So what behaviors can help one invest with patience?

First, very simply, avoid picking individual stocks, looking at the track record of a mutual fund to make an investment choice and avoid changes to your allocation of stocks and bonds because of what you (or an advisor) thinks the market might do.

Second, investors can realign their view of the market (that is, their context). If investors shift their view to see and embrace down markets as an opportunity to rebalance a portfolio and buy investments on sale, market drops could be less scary for them.

Can investors (or investment advisory firms) do this on their own?

My contention is no. Not without ”coaching” and viewing the stock market as something that it works and can’t be beat!

In the end, choosing a wise financial strategy, one that promotes investing with patience, and sticking to it can have tremendous impact on an investor’s long term financial health.

Chasing performance through buying and selling is a risky game. Historically speaking, it will only reduce an investor’s real return. Relying on unbiased, non-emotional advice from a trusted investor coach to make good decisions can help an investor bridge that gap between what the average investor makes and the return of the market.

As your financial coach, I can help you avoid the temptation of gambling for quick returns and keep you focused on investing with patience to make your money work for you in the long run. Give me a call at 913-696-1106 or click here to email me and let’s start a conversation today about the right investment strategy for you.

-Brendon Jenks, Financial Coach

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