Quote:
Originally Posted by Enoch Root
I too am a portfolio manager and an investment advisor. Several lawyers around here, but I am not one of them.
The pressure to act is just human behavior and how it works against us. We are over-confident (especially men), and then when the market moves against us, we feel stressed and it causes us to act emotionally, when that is exactly what we should be avoiding.
There is a mountain of information on behavioral finance and how human behavior is not built for investing, if you are interested.
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You are absolutely right. The best thing is to get to know yourself, your risk tolerance and investment tendencies. I know I am too conservative (comes with age) and have trouble with "paralysis by analysis". My wife has always advised me to trust my gut. It came from years of telling her that my gut tells me to buy such and such, and I wouldn't and it would go up.
At present, my investment philosophy is simple i.e. to buy quality stocks like banks (RY, TD), railroads (CP, CNR), telcos (T. BCE) oil and gas (CNQ, TOU), Gold, etc. and hold them for long periods of time, and to vary the amount of cash depending on how I view the future.
I have no idea what the market is going to do in the next year or two. I think a lot of stocks are reasonably priced, however with a probable upcoming recession, there is a good chance that there will be an opportunity to add to portfolios in the future.