If patience is not exactly one of your greatest qualities, we tell you why you should put it into practice, at least in the field of investments.
Imagine that you bought real estate in a good area of the city. Some years, lease rates are high; others, not so much. But you bought it because you trusted that over time the property would appreciate.
Year after year, you receive cash flows, and selling soon is not in your plans, since you believe in the long-term potential of your investment. You know that over time, the property will substantially increase in value, and when you sell many years later, you will receive a considerable profit. In that case, we could say that you were a patient investor and that the wait was worth it.
The key of success
Now imagine that you also invested in shares of more than 9,000 publicly traded companies in the world: Apple, Google, Tesla, Toyota, among others, as well as in more than 19,000 bonds issued by governments and companies, and in all the raw materials of the world. world (oil, gold, wheat, silver, etc.).
Over time, stocks, bonds, and commodities also increase substantially in value. This time, however, you don't wait many years to sell, but rather you go in and out of these investments several times, depending on the market price that appears on your cell phone.
Sometimes you buy or sell at the right time, but most of the time you don't. Even though the investment ended up appreciating, you do not receive all the profits due to wrong Market Timing; then you learn that it would have been better to hold on through thick and thin. Being an impatient investor hurt you.
Patience, ally of investments
The ease with which an asset can be converted into cash is called liquidity. It is one of the main benefits of investing in the publicly traded stock, bond and commodity markets.
It is possible to sell these assets with just the press of a button on your cell phone. However, this benefit is a double-edged sword, since we have to see the market price of the assets every day.
As emotional human beings, we are usually not prepared to handle these price changes.
