Page 40 - DIY Investor Magazine - Issue 26

HOW TO BUILD CONFIDENCE
Self-confidence comes from seeing your returns over time, becoming aware of how you react in nasty market sell-off’s and when things go - this will happen a lot! - But even those with many years under their belt can struggle with self-belief issues.
Simply copying other people can work, and may be fine initially for a newer investor, but it is fraught with risks, such as the source of your ideas disappearing and leaving you high and dry.
It is far better, and to me more enjoyable and satisfying, to choose your own socks and make buy and sell decisions yourself; progressing to self-reliance very soon is likely to be far more successful and sustainable - anybody can pick quality stocks, the talent is in detailed portfolio management.
Key to dealing with low self-confidence is realising you have a problem that you need to address head-on and improve; you are almost certainly more capable than you think you are.
In my experience pretty much anybody can become a competent and successful long-term investor; short-term trading is much more difficult and the vast majority will fail at it.
This mindset will help very quickly; there is no problem in taking ideas from other people - I do it all the time - but don’t blindly and unthinkingly do it. Certainly never rush into any buy or sell decision – if you are pumped up and excited, you are most likely about to make a very expensive mistake.
Another highly important consideration is how well a stock fits with the others in your portfolio; what does this potential new investment ‘bring to the party’ in terms of diversification and overall risk management.
Get into the habit of hunting out your own ideas and I have written a lot of material over the years about doing exactly this which you can find on my websites; Twitter is also a great source of potential new ideas for you to investigate further @ wheeliedealer
It is a good idea to get on Twitter or hunt out people like myself if you already use it, and engage with the vibrant community that has built up; as with any type of social media you need
to keep your wits about you and control your usage because it can drive you a bit mad at times, but if you follow the right people, it is all very civilised and positive.
You may find there are investment cubs in your local area; if you get on Twitter and engage with other investors you can probably find like-minded people who live near you.
If you do wish to find people in your area, then feel free to contact me and I will happily let my readers know that you are about and would like to meet anyone who is interested.
Lastly, and I would say that, wouldn’t I? The Twin Petes podcast is an excellent source or regular information and debate; click the logo to give it a try, and feel free to leave suggestions for future editions:
Regards, WD
@wheeliedealer
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To understand how you compare to other investors,
take advantage of the various social events such as the WheelieBash and there are others such as the Mello Events run by David Stredder and the free shows in London such as Master Investor and the UK Investor Show. Other good events are put on by ShareSoc and piWorld and Blackthorn Focus.