I know nothing about the stock market. This year has been my first year investing in stocks, and to say it has been a “learning-curve” is an understatement. Some days I am up, and some days I am down. It isn’t my day job, but I’m improving. I have learned a lot about mindset while watching the arrow ping-pong around. Primarily that there are two types of mindsets: short-term or long-term.
Short-Term
A short-term mindset in investing is considered day-trading. It probably should be considered gambling. Buy a stock when the price is low, only to sell it later that day. The turnaround is quick. Sounds easy enough. There can be high payoffs for those who buy and sell at the right time. There can also be major setbacks for those less fortunate. The risk is high and consistency over the long-term can be difficult.
This short-term mindset happens in life as well. We thrive off the idea that we can buy a $2 ticket at the gas station and have $25 million in our account the next day. “Just keep drinking our shakes, you will be down ten pounds in a week!” My own brother approached me about selling off my Pokémon cards because they were worth a TON. For what it’s worth, I gave them away to a kid a year before… and what do I know, he’ll probably be a millionaire. The point is short-term actions do not guarantee long-term results.
Long-Term
A long-term mindset in the stock market is truly, investing. Slowly buy into companies for their growth over the next ten to fifteen years. Diversify stocks so you are never at a point where you can get too hurt. The growth happens, but gradually. You may look up at the end of the month and be up 6%. You may be down a little, but you’re never really in harm’s way. This is the life-investment plan.
Having a long-term mindset in life can really be beneficial. Putting a little money away every month can help grow your savings over time. The steady weight loss of eating well and working out will help you keep the weight off. As for the Pokémon cards… give them to your grandkids, let them sell them for an unheard-of amount. You will see that your actions become sustainable and your results will be too.
The stock market never seems to stay in one place. Up or down, better or worse. It’s not about the quick hits and short gains. It’s about investing over the long run. What are you investing in? Invest in habits that will help you grow over time. Shortcuts aren’t the answer. Remember there is always a bigger picture.
