Seven habits of highly successful investors

INVESTMENT success is attributed to behaviour and adopting these habits, not luck or mathematical genius.

1. Commit to your long-term investment strategy and don’t fall victim to your emotions. Emotions can be the biggest destroyer of wealth over time. You should concern yourself with only two value points: the inception date and the exit date of your investment. The rest is noise. Learn to be patient.

2. Understand that the long-term investor’s true nemesis is inflation. Don’t be tempted to invest in a cashonly portfolio; this would be reckless.

3. Expect financial emergencies and prepare accordingly. Always set money aside so that you don’t have to access your investments. Continuously accessing your investments can be detrimental to them in the long term.

4. Make sure you are well diversified. Understand that you need to diversify your portfolio. The asset allocation is vital; it explains 94 percent of the variance in return.

5. Use specialist skills and expertise. Select highly skilled financial advisers who have the tools to bring you the optimum return on your investments, to achieve your financial goals.

6. Don’t try to time the markets. If you do, you stand a huge risk of diminishing your returns.

7. Practise these habits… constantly. Healthy investment habits keep your investments on track and give you long-term peace of mind.

Although there is seemingly a lot of complexity in the financial sphere, these seven habits are pretty simple. The power of investing to build wealth and achieve long-term goals is not out of most people’s reach. It comes down to having the discipline to follow the guidelines that work, and when in doubt to contact a trusted financial adviser to help you reach the finish line.