One of the most daunting challenges that modern investors face is the sheer speed and volume of information. In a digital world, news is instantly beamed to billions of people without delay. We are bombarded with updates on dozens of companies every day. With countless channels for communication, even obscure companies can propel themselves into cult status followings. It is no surprise that many investors feel overwhelmed.
"Plan your trade and trade your plan"
Great investors know how to filter through the noise and seek out only the most important information, they can also maximise the amount of relevant information available to them.
With quarterly results upon us and companies giving their first insights into FY21, these skills are critical. True investors are happy to digest results and market reactions and invest accordingly. Punters, on the other hand, are happy to take a guess and hope.
The definition of gambling - "Taking a risky action in the hope of a desired result"
While many would like to differentiate the perceptions of each endeavour, ultimately the distinction is moot - investing is the definition of gambling.
However, just as there are experienced investors that let diligent research and competent risk management drive their decisions and success. There are professional gamblers that do the very same. Some of the key differences between the professionals and the "mugs" are simply organisation and dedication.
Good investment decisions that underpin consistent performance are only made possible by one’s knowledge of their investments and one’s ability to manage risk and capital. And like any endeavour, if you don't have the expertise or the time, you can always seek professional help.