The main issue I want to focus on is how we lose sight of what we’re looking for and why we’re looking for it when it comes to investments. How is it that we end up leaving everything in the hands of ambitious novices instead of maintaining control of our assets and making them truly grow and perform as we want?
When I started working in banking back in the late ’80s, one day I was assigned to sit at the trading desk to learn a bit about the business. I felt like “Gordon Gekko” (Michael Douglas in the movie Wall Street) and quickly started buying and selling currencies. I thought it was an easy task. At the end of the day, I reviewed my numbers: the number of transactions, trading volume, average quotes, and so on. The problem was that, when I sat down with the boss to review those numbers, I realized that I had caused the bank $250,000 in loses…
I was overwhelmed with fear, and I thought I was about to be fired when my boss said, “I’ve just invested a quarter of a million in your training; don’t waste it, help us improve so that this doesn’t happen again.”
At first, I wasn’t sure if it was luck or if life was teaching me a unique lesson because, over time, I would dedicate myself precisely to this topic: structuring and creating business opportunities without risks so that all parties can benefit and achieve their goals, objectives, and dreams.
The financial world is a very complex one. I’ve learned it the hard way. Decisions that are out of place or based on limited information cost a lot, a lot of money, time, and effort. And the same goes for correcting them.
In a way, many of us think we’re great magnates on Wall Street when we open an investment account or operate on a trading app on our mobile or laptop. A friend or acquaintance gives us a “foolproof” tip. As if it were a sure thing for the races or Sunday’s Derby. We almost always believe them without any idea or basis for why we should buy or sell something or make a particular investment. We often believe in this “word of mouth” blindly.
Now, I think: on the New York Stock Exchange, there are more than 64,000 (yes, sixty-four thousand) different stocks traded every day. That means that every morning, before the markets open, 64,000 status reports are published for each of the stocks and industries in question, along with news about influential sectors and markets. Personally, it would take me a week to read just a quarter of these reports. Therefore, I wonder: is there really someone out there who believes that there’s a person who can truly anticipate and know what the best buying option of the day is?
I’ve spent 10 years giving talks to fund managers, and I always asked them the same question. Surprisingly, no one ever gave me an acceptable answer.
… Today, more than one person talks to me about “Artificial Intelligence” that can analyze all this information and draw its own conclusions. We’ll discuss this in another paper, but for you to think about: “AI” analyzes historical and published data and draws conclusions from that. Neither the market nor human behavior have a cyclical behavioral line that one can analyze and predict. We will see many examples of this in the case…
After all my experience, successes, and lessons learned, I realized that the world of banking and investments was taking an easy path. A path where the same people always win. A path where there are actually no winners but rather advantage-takers, who are often intermediaries and product developers.
The market is constantly giving and showing us opportunities. But if we are not prepared to get on the train, and we do not go to the station, it will be impossible to take advantage of them.
We could invent all the technologies in the world, digital wallets, Crypto, Blockchain, FX & trading apps… but all this would never be of use when the issue with successes or failures in this world is a basis and fundamental issue.
As investors or savers, we start investing, hiring brokers (either directly or indirectly) without having an idea of what we want to do or where we want to go.
