It’s not brains that will help you beat the stock market, it’s your stomach.
Peter Lynch once said that you can be the world’s greatest expert in financial statements but without a strong stomach, you will succumb to the negative headlines, and sell in panic when share prices go down.
That is what’s happening today.
With dark clouds gathering around the global economy, stocks are generally cheaper today compared to the past two years.
Yet, many are not won over by the lower valuations.
It’s not for the lack of data or analysis. There is more information readily available today than there has ever been.
Instead, the root of the problem is something simpler — FEAR.
When fear overcomes reason
When it comes to investing, many picture themselves making rational, well thought-out decisions.
However, in reality, this same group is prone to reacting poorly to stock market moves....