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If Investing Were an Exam, Here Are the Traits of Investors Who Score A, B+, and B
I have read about and met many successful investors to extract their traits.
If investing were an exam, here are the traits of a successful investor Who Score A, B+, and B:
A Grade: The Unique Independent Thinkers
Expected return: 15–20% CAGR
Unique independent thinkers represent the top 1% of the investing world. Their outstanding returns come from doing the right thing when others are wrong.
This might involve:
- Investing in wonderful companies facing short-term distress and disliked by other players.
- Shorting currencies that are pegged, which other players believe will never de-peg.
- Shorting Credit Default Swaps, offering 10–20 times the reward, in a housing market that bankers think will never collapse.
As Warren Buffett said, “The dumb things other people do create good opportunities.”
However, being a contrarian or independent thinker alone is not enough. You need to blend your…