Today, I'm pleased to present a guest post written by an excellent writer whose blog discusses a myriad of interesting topics. I'm a loyal reader.
About the Author: Josh Hanagarne writes World’s Strongest Librarian, a blog with advice about living with Tourette’s Syndrome, book recommendations, buying pants when you’re 6’8”, kettlebells, old-time strongman training, and much more. Please subscribe to Josh’s RSS Updates to stay in touch. John resides in Australia.***
A Librarian’s Perspective on Analysis Paralysis, or: How I Beat The Market And Bought A Candy Bar With My Profits
I got bitten by the stock bug a couple of years ago after reading one of Jim Cramer’s books. It came across the desk at the library and I just wanted to know what the bald guy on the cover was screaming about. At the time, I didn’t know about the show, which was for the best.
I got excited while reading the book. The thought of making money in the market
sounded really, really nice. So, as any
respectable librarian would, I started doing some research. You don’t do things without educating
yourself, right?
I wanted to make an informed decision before I started
throwing what little money I had into the whirlwind.
So I began educating myself.
A Common Character Trait
I know a lot of writers, bloggers, powerlifters,
bodybuilders, and professional strongmen. These groups all share a common characteristic—successful members of
these clubs attract hordes of newcomers who blaze with enthusiasm before they
realize how hard and thankless the work can be.
The books and gurus pump them up, they vow to knuckle down and get after it, and they do…for a while at least.
When the initial passion subsides, many of these people
convince themselves that what is required is further study. Unfortunately, it is easy to convince
yourself that reading about writing is actually writing.That reading other blogs is “research” for your
own blogging. That reading a book about
isometrics is making you stronger.
The “Preliminary”Reading List
Here was my reading list before I convinced myself I was “ready” to jump into stocks:
Mad Money
The Little Book That Beats the Market
Against The Gods
A Random Walk Down Wall Street
The Only Investment Guide You’ll Ever Need
After that last one, I thought: okay, I’ve got to be ready. So
I got an account on Sharebuilder and Scottrade.
Then, instead of investing, I read:
Hundreds of Articles on Morningstar
Lots of charts on the library’s expensive Value Line database
Tons of archived articles on Investor’s Business Daily
Something else Jim Cramer wrote
A few thing by the Motley Fool guys
The Five Rules For Successful Stock Investing
One Up On Wall Street
The Intelligent Investor
Rule #1: The Successful Strategy For Successful Investing in Only 15 Minutes A Day
And then, I was ready.
Sort of.
I closed my eyes, spun in a circle, gritted my teeth, and bought three shares of Research In Motion just like everyone else was doing.
It did really well for a while, but eventually I sold it in time to make about $5.00. Thrilled by my cunning, I went and bought a King Sized Twix and savored it to death.What I Learned
Invest in unsexy stocks that grow over time or chase things
that are sexy at the moment. A lot of
people tend to do that all at once, which I learned can create its own
problems.
Regardless, it was the people who acted who had something to
show for it, whether it was a financial profit or just a hard lesson learned.
Even calling me a beginner is generous. But my limited experience has convinced me that like anything else, investing can be over-analyzed. There can only be so much hand wringing before you admit you’re just stalling, even when the stakes are high. If an ER heart surgeon debates for too long, the results will not be good for anyone involved.
The risk of losing money terrifies me, but reading about
investing without really committing around to it felt like a waste of
time. That’s on me.
But it was better for me—better emotionally, mentally, and fiscally-- to waste my time than to potentially waste my money. That’s why I’ll never have a mansion. That’s why I’ll always be a beginner. Because when something is uncomfortable to me, analyzing it is easier than doing it.
Study gets you just so far, and then you’ve got to choose. The choice will be different for anyone, because we all think in very different ways. The pendulum of common sense and reason swings far indeed.
But man that candy was good.
463
