I suppose me writing this was inspired by the fact that three people had mentioned the same thing (in different ways) to me in the last week - feel it is a sign.
Desh. Desh has recently started his share portfolio, so the other day he said, "I need to find something else to buy." Why, because at the end of the month people get paid and then there is money available. Desh is being disciplined, is saving and has the right idea (almost).
Kyle. Kyle is starting a fund in two weeks and has over R1 billion to invest, and when the money transfers there is this expectation that the money must be invested immediately (day 1).
Justin. Justin is a portfolio manager and was talking about investor expectation, i.e he'll get allocated R 100m and people want to know what you going to buy and want you to do it now.
Kyle and Justin being seasoned pro's understand how ridiculous the concept is and we had a chuckle but they have no choice. When your fund is an equity fund, people want equities, even if you think, you should hold cash or want to wait a bit, you have to buy equities.
You worked hard or gave your time to earn your money. You don't have to use it right now. It is important you realise that. Patience is a virtue in life and investing.
So realise as an individual investor one of your biggest advantages is you don't have to buy equities right now. You might say, "if it is not invested, you aren't compounding", somewhat true, but in your trading account, it is earning interest (so at least not going backwards) and more importantly you are NOT losing money.
When you decide to start something, it is exciting. With investing, you feel like you want to get involved, you want to buy, you want to learn. I think in people's minds, 'buying' is the picture of investing. This links with the questions people ask and there response: "What shares should i buy?" "What shares are you buying?". You give them one or two suggestions, which they either like, or shrug off, then ask for more.
MORE! Why would I have more? If you read 'Believe in yourself', you'll see I believe in concentration (only because I feel comfortable enough in my ability). So I don't buy lots of shares, because there generally aren't a lot I want to buy. Also when I buy a share I am normally willing to buy more of that share in the future. Most of the time I wish I could buy more, so as soon as I get more money I try buy more, until I think it is at a fair value.
I do own more that two shares, but that comes with time. For a year I might buy 1-3 shares, but the next year I still have those, and buy another 2, and the next year the same, then maybe I sell one. I didn't wake up on Monday and go "let's buy 10 stocks"! If you going to put time into something, then you need to get some value out of it. Let's use an example of a share that goes up 100%.
If you buy one share and it goes up 100% you make 100% (and you likely tell all your friends ;-). Let's say you buy 100 shares, and one shares goes up 100%, you now have made 1% (you still tell all your friends, buy forget to mention that it is a 1% position). To make 100% with 100 shares, you have to firstly find, then research and get right 100 investment decisions, which to be honest is unlikely!
So take your time. Remember, you don't have to swing, but if you do, make sure you did your homework so you can knock it out the park!