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What is your personality? Are you a straight shooter with clear goals in mind, or do you like to sail wherever life takes takes you? These are the same types of questions to ask yourself when it comes to finding the right investment for your business.
Many times, when we invest in something, we have no clear answers as to where it will lead to for us in the future, in hopes that the market won’t crash or some other disastrous entity that could hinder our good fortune.
Perhaps you’ve striven to accumulate multiple stock options, while listening to the advice of financial advisers, even friends and family, among your own opinions. But have you ever stopped to think about the right type of investment that will fit your personality?
To “know thyself” is an extremely important attribute that can lead one to financial freedoms as well as focuses on the right investment for you, while knocking out other extraneous business ventures.
By knowing what makes you tick, you can assuage any potential failures in the long run. While many investors find themselves at a lost of what market to lean to, you won’t have that problem. Thanks to these useful tips, you can also decide the best investment for your company that also matches your character.
Personality Based Investment Strategy
#1) Who Are You?
First and foremost, when assessing your personality, you have the option of hiring a personality assessment professional or simply taking on online quiz. Your personality says a lot about where and when you choose to invest. It also helps to determine whether or not you prefer to take chances or if you jump the gun leading to investing too early. According to Morningstar, a Canadian workforce news source, there are 5 main traits, also known as “the big 5“.
These personality traits are just a few of many that are the most important when deciding on the investment you want to lead. They are as follows:
– Extroversion: sociable, talkative, enthusiastic
–Agreeableness: Trusting, altruistic
–Neuroticism: Emotionally unstable individuals
–Intellect: Imaginative,curious, open-minded
#2) Why Your Traits Matter
In knowing what the top traits are and why they are vital in investing, it is also important to note that a person’s attributes also are the predetermined entity of how money is distributed and invested.
For example, you may be someone who is of the intellectual mindset, which means that you are pretty flexible when it comes to how you handle your monetary distribution. You may find that investing in risky ventures as well as safer offerings puts you in a place of vulnerability, but it doesn’t make you nervous at all.
On the other hand, someone who is more neurotic may invest in a market based off emotion. Going by a gut feeling may sway you from doing something that will end up saving you in the long run, yet on the other hand you may jump the gun too easily and lose money. It truly is a win-lose situation,which can lead to a good or bad thing.
So, in all aspects of knowing what makes us tick, we can determine why and when to settle or if an investment works.
#3) Assess Your Risk Tolerance
Risk tolerance is the amount one can without should their investments fall through. It is important to know how much one can bare so there are other options to run to if the investments fail.
Just like with personality tests, there are many risk assessment exams that one can participate in as to avoid making the wrong move and to better optimize on the choices that one makes when it comes to to investing for only a short period of time or for years to come.
Other factors that affect risk tolerance such as future earning capacity, and the presence of other assets such as a home, pension, social security or inheritance are more stable markets. This will assist should your other investments not come through so that there are other funds available.
Investing can come with its share of benefits, but since there are also potential dangers in it as well, taking the necessary precautions when it comes to finding the right fit fir your investments is key to a more stable future.
Tell us. What personality trait do you have that could effect your business venture? Do you think that an investment can change you for the better? Tell us what you think in the comments below.