Does it matter what my emotional reaction is to my portfolio?
I consistently attempt to maintain personal comfort regarding my investing.
There are some “rules” I follow, Mostly regarding what I will not invest in.
In general, I avoid:
– Defense
– Private prisons
– Tobacco
– Retailers
– Fast food
– Technology
– Airlines
– Hotels and Cruise Ships
– Cryptocurrencies
It is likely easy to understand why I avoid at least some of them. Reasonable poeple may disagree with my choices, but they are mine, and I choose to live with them. I can sleep at night.
Retailers and Fast Food: I avoid these because I feel they are similar to fashion–their prospects can change on a whim. In addition the quality of fast food is so poor, I don’t want to even support them.
Techonology: Whle if it obvious that here is money to be made in tech, my goals are not the same as most retail investors. I am a dividend investor. Tech often pays no or little dividends. My approach is to buy dividend payers, let the dividends reinvest, and forget about them (hopefully) for years. Because tech companies propects and products change rapidly, in my view one needs to monitor one’s tech holdings frequently. Tech products go obsolete. And monitoring frequently goes against the opportunity to buy and hold for the long term.
Cryptocurrencies. There seems to be opportunities for profit with crypto, however the whole industry is frought with scams and outright fraud. The volatility and reliance on delusion repels me. Since crypto is based on no real products, no real economic business, while you make money in crypto before it goes South, I will be safe elsewhere.
I gravitate towards:
– Industrials
– Consumer Staples
– Consumer Discretionary
– Financials
– Pharmaceuticals
– Utilities
I do not buy stock just because they are in these groups. They need to be steady dividend payers, have good prospects, and appeal to my sense of comfort.
Which brings me to the point again. My investing is based on my comfort level. Investing comfort leads to investing success.
Investing success in this case does not necessarily mean profit. It does means that investing success is created by joining in the financial world by investing. Success is participating. The worst decision is to decide not to invest.
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