...but you can still find it thrilling

FOR most people, good investing should be boring. It should be slow and steady with rewards reaped over decades, not weeks.

The exciting bit should be the outcome – the first home, or the richer retirement that investing bankrolls – rather than the process.

Understandably, many investors enjoy the excitement of investing itself. After all, testing your stockpicking prowess and predicting the latest market trends can be thrilling.

For these investors Rob Smith, head of behavioural finance at Barclays, suggests a compromise.

He says: ‘One option is a core-satellite approach. Investors could put the majority of their money for the future into something stable and boring.

‘Then they add a small, satellite component of investments that gives them more enjoyment, keeps them engaged and gives them emotional reward – but without derailing their longer term financial plan.’

That means you can still enjoy the status of being an investor in the companies you most admire – and the rush of seeing their share prices rise and fall.

This approach may also help you to learn tough lessons that will help you become a better investor in the long term. ‘Personal experience is one of the best ways to learn,’ says Smith. ‘People often say that you can learn from others’ mistakes. But the truth is that investors tend to be over-confident and think they won’t make the same mistakes as everyone else.’

Smith cites the example of queuing at a cash machine when the person in front of you turns around and says it is not working.

Most people will still try out the machine nonetheless, believing they will have more luck than the person before them.

‘Nothing can reproduce the experience of doing something yourself,’ says Smith.

‘When investing, you want to be able to make your own mistakes without suffering huge financial losses.’