While running a marathon is great for your mental and physical health, it is also a good exercise in willpower. What’s more, it does not require any fancy equipment. For these reasons, it is not hard to see why more people have started running marathons in recent years. Sam is a marathon enthusiast. Training day after day, he has achieved excellent results. However, his investment mentality is completely different to this. Sam often expects profits from short-term speculation and success at the very first step. He also lacks a long-term and systematic investment plan. Are there any short-cuts in the “marathon” of investment?
People have many different financial goals in their lives, involving different amounts of money and investment periods. Long-term investment plans should be formulated and implemented step by step. Here are three key factors to consider in the “marathon” of investment:
1. Set goals and embark upon the long-distance investment race
Like a marathon, long-term investment is a long-distance race. The finish line may seem out of reach, but we first need to determine whether it is 10k, a half marathon, or a full marathon, as well as our desired result, before we can train, plan the course and choose the right strategy. Long-term investment “runners” should also have clear financial goals and timelines, and gradually close the distance using appropriate investment vehicles.
2. Taking advantage of your time early on
Marathons place particular emphasis on stamina and willpower, and require a long period of exercise and slow adaptation. So, the earlier you start, the better – you don’t want to get in over your head. The same is true of investing. The sooner investors start, the more they can take advantage of their time and invest their savings more easily through the compound interest effect. However, they also need to take investment risks into account. Do not rush in head first, trying to grasp so-called “opportunities” in a volatile market. This can cause you to veer off course onto dangerous short-cuts.
3. Pay attention to investment changes and adjust your strategy accordingly
As accidents often occur on the track, runners should always watch out for obstacles and hazards, and adjust their breathing and pace to suit different distances, inclines, and declines for longer and more stable performance. Investment environments, as well as stages of life, are also subject to constant change. Investors should frequently monitor their investment progress and results, closely follow market information, and adjust investment strategies accordingly to secure better results.
Finally, every long-term investment “runner” has different investment preferences, investment periods, expected returns, and risk tolerance. Therefore, everyone’s paths and goals are different. Do not just follow others — run towards the finish line at your own pace. Get started!