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- What happens when markets are extremely volatile? <\/li>\n\n\n\n
- Should we get greedy when others are fearful and vice versa?<\/li>\n\n\n\n
- Do we really need to network in business?<\/li>\n<\/ul>\n\n\n\n
Si quieres que responda a alguna pregunta en Quora o YouTube, o est\u00e1s buscando invertir, no dudes en p\u00f3ngase en contacto conmigo<\/a>, correo electr\u00f3nico (advice@adamfayed.com) o utiliza la funci\u00f3n de WhatsApp que aparece a continuaci\u00f3n.<\/p>\n\n\n\n
Es posible que algunos de los enlaces y v\u00eddeos a los que se hace referencia s\u00f3lo est\u00e9n disponibles en las respuestas originales. <\/p>\n\n\n\n
Fuente de todas las respuestas: p\u00e1gina Quora de Adam Fayed.<\/p>\n\n\n\n
What happens when the market gets extremely volatile and bearish afterwards?<\/strong><\/h4>\n\n\n\n
<\/figure>\n\n\n\n
Imagine you are walking up a mountain with a yoyo. The yoyo is going up and down.<\/p>\n\n\n\n
You are only focused on the yoyo, so don\u2019t actually appreciate how high you are going.<\/p>\n\n\n\n
Maybe once or twice you fall back a few steps, as you aren\u2019t focused on what is going on.<\/p>\n\n\n\n
Suddenly you get to the top and don\u2019t realise how high you are:<\/p>\n\n\n\n
<\/figure>\n\n\n\n
That, right there, would be the story of markets over the last few hundred years.<\/p>\n\n\n\n
If you adjust for dividend reinvestment, any long-term investor has made a lot of money.<\/p>\n\n\n\n
Every $100 invested in 1990 would have been worth about $1,500 recently, and somebody who invested $1,000 in 1945 would have made millions, but has also seen:<\/p>\n\n\n\n
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- So many crashes<\/li>\n\n\n\n
- Countless doom and gloom merchants in the media<\/li>\n\n\n\n
- Famines, wars, potential nuclear conflicts, trade spats etc. The news is an endless cycle.<\/li>\n\n\n\n
- An astonishing number of unexpected turns, both on the up and downside.<\/li>\n\n\n\n
- An incredible number of ups and downs.<\/li>\n<\/ul>\n\n\n\n
The point is, the long-term investor who makes the most people doesn\u2019t care about bearish or bullish sentiment.<\/p>\n\n\n\n
That is speculation, and usually speculators speculating on what other speculators are speculating about.<\/p>\n\n\n\n
The markets were bearish in 2008 and 2020, and then had great runs. There have been other times markets have been bullish and then unexpectedly fallen.<\/p>\n\n\n\n
The key is being an investor rather than a speculator, and understanding that markets are prone to these extremes in emotions.<\/p>\n\n\n\n
“Be fearful when others are greedy and be greedy when others are fearful”. Heard it many times, but how can someone really know what others do\/think?<\/strong><\/h4>\n\n\n\n
I think it is usually obvious in extreme, or even relatively extreme times.<\/p>\n\n\n\n
During 2008, it was obvious people were fearful:<\/p>\n\n\n\n
<\/figure>\n\n\n\n
That changed and people got greedy once it was obvious that the banks would be saved.<\/p>\n\n\n\n
People also got fearful in 2016 due to Brexit and Trump, and many other minor events.<\/p>\n\n\n\n
The more extreme year was 2020. When Covid first struck, markets and people were calm.<\/p>\n\n\n\n
After the US and several European countries announced lockdowns, there was blind fear.<\/p>\n\n\n\n
Markets fell by 50%. That happens from time to time, and isn’t unique, but this time the falls was quicker.<\/p>\n\n\n\n
The recovery was so quick that by July and August people were getting greedy:<\/p>\n\n\n\n
<\/figure>\n\n\n\n
Now people are fearful, albeit much less so than 2008 and 2020, and even a bit less than a week or two ago, now some markets have started to recover some of the lost ground.<\/p>\n\n\n\n
The best option for the average investor is to put in every month, or year, and accept the ups and downs.<\/p>\n\n\n\n
Timing markets really doesn\u2019t work. However, if anything, you should want to invest even more during the bad times.<\/p>\n\n\n\n
Your future returns will always be higher in that case, but it is just too difficult to keep money in cash and predict when markets will fall by big amounts.<\/p>\n\n\n\n
The problem is, most people get greedy when others are also feeling the same way, so pile in at the top and then get out when there is a fall.<\/p>\n\n\n\n
We saw that with funds like ARK. At one stage the performance was incredible:<\/p>\n\n\n\n
<\/figure>\n\n\n\n
So many people piled in, but then got out when the fund was down 50%.<\/p>\n\n\n\n
Many studies have shown that the average investor has lost money in the fund, as they bought high and sold low.<\/p>\n\n\n\n
Why do we need networking in business?<\/strong><\/h4>\n\n\n\n
I remember listening to a famous businessman a few years ago say that you only need six people to hold your coffin in the future:<\/p>\n\n\n\n
<\/figure>\n\n\n\n
The point is that we don\u2019t need to impress many people in life.<\/p>\n\n\n\n
Having a small number of key people, like a spouse, true friends, and a reliable business partner, is more important than being close to loads of people.<\/p>\n\n\n\n
This is relevant for business networking, and indeed investing.<\/p>\n\n\n\n
In business networking, a Harvard study found only 1% is useful:<\/p>\n\n\n\n
<\/figure>\n\n\n\n
The other 99% is:<\/strong><\/p>\n\n\n\n
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- Time wasting<\/li>\n\n\n\n
- Socializing<\/li>\n\n\n\n
- Eating and drinking<\/li>\n\n\n\n
- Pursuing hobbies when you thought you were going for business.<\/li>\n\n\n\n
- Kidding yourself that you are being productive.<\/li>\n<\/ul>\n\n\n\n
I have seen it myself, all around the world. Typically, most people go to golf and chamber of commerce networking events, and it becomes social.<\/p>\n\n\n\n
That is fine if you want to go to a social event, but you shouldn\u2019t kid yourself that most networking is useful.<\/p>\n\n\n\n
What is more useful is taking advantage of those very small number of opportunities that networking might afford.<\/p>\n\n\n\n
If you go to 1,000 events, you might meet a very special person who can help you (and vice versa) on two or three occasions.<\/p>\n\n\n\n
Taking advantage of those rare opportunities in networking is more important than just building up a huge number of contacts.<\/p>\n\n\n\n
That isn’t to mention that the world has changed. The online world is now more important and gives you access to billions of people.<\/p>\n\n\n\n
The importance\/the need for networking used to be getting known, in the same way, that cold calling was utilized.<\/p>\n\n\n\n
Getting known, and scaling it, is now easier online. You can\u2019t meet a million people at a networking event.<\/p>\n\n\n\n
If I want insurance or to buy a car, I will Google or go online. I am more likely to give my business to a random online company or some online personality who I have gradually got to know.<\/p>\n\n\n\n
There are more online reviews and there is a clear separation between social and business.<\/p>\n\n\n\n
Doing business with people I know in-person is awkward. If something goes wrong and I am unhappy as the customer, the friendship and acquittance is also ruined.<\/p>\n\n\n\n
\u00bfLe duele la indecisi\u00f3n financiera? \u00bfQuiere invertir con Adam?<\/strong><\/p>\n\n\n\n
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