Author: Toni Husbands / Source: Wise Bread
Warren Buffett, the Oracle of Omaha, summed up the key to investing success like this: “Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing.”
Let’s say you and I have ordinary intelligence and want to improve our investing chops.
What are the traits that make for a great investor?Compassion
Hollywood is awash with stories of money men who live by this mantra: “Greed is good.” The Gordon Gekko character is burned into our collective memories for life. From The Boiler Room to The Wolf of Wall Street, we get it — the industry is full of sharks.
It turns out, sharkiness may work against you in the world of finance.
A study published by the Society for Personality and Social Psychology looked at the behavior of hedge fund managers over a decade. Managers with psychopathic, narcissistic, or Machiavellian personalities underperformed their peers by 1 percent annually. Over time, their ruthless approach to decision making added up to notable losses.
By avoiding aggressive instincts and underhanded tendencies, we can focus on developing the positive, compassionate traits that have helped billionaire investors like Warren Buffett and George Soros achieve amazing results. This means leaving the shady, cunning type of investor to Hollywood. (See also: The 5 Best Pieces of Financial Wisdom From Warren Buffett)
Optimism
Some people avoid investing altogether because they believe they’ll never succeed at it. That mentality can become a self-fulfilling prophecy. Make no mistake; if you never take the plunge into investing, you’re guaranteed to never see…
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