„Feel free to share, obliged to quote, and appreciated for both!“

What truly matters

To successfully invest money on the stock market, we need full access to our so-called System 2, i.e. logical thinking. This enables us to inform ourselves and put together a portfolio that we can assume will increase in value in the long term, mirroring human progress. However, our decision-making mechanism does not only consist of consciously controllable processes, but rather of unconsciously running (system 1) processes. On a logical, rational level we can assume that phases of loss that will be steadily made up for in a following recovery phase if there is sufficient diversification. However, on an emotional level, we often go “bankrupt”. Since our System 1 contains a deeply anchored protective function that is coded to avoid pain, this often leads to a strong impulse to act. In downturn phases or stock market crashes, this leads us to act in order to save the still usable capital into a safe haven in order to avoid further impending losses. System 1 prevails.

My mountain metaphor for relaxed investing

I want to compare this process to a mountain hike to prevent you from selling while your stocks are close to the bottom. Imagine you have a long leg up a mountain ahead of you. To get from your starting point to this mountain, there are three smaller mountains on the route. In fact, you know that it would be best if you only climbed upwards. But that is not the way nature is usually designed, and after each ascent there is a downhill passage. The “nature of the exchange” is hardly any different here. Except that you cannot plan exactly when it will go up and when it will go down in advance.

By the way: the presentation of stock market investments as a relaxed mountain hike in nature may represent a change of perspective for many. You can learn more about a change of perspective in the next article.

More articles

The ABC of Questioning Techniques: The SPIN Questions

Questioning techniques are an essential element in my coaching kit. Today I am therefore starting the ABC of Questioning Techniques, in which further questioning techniques will follow in the coming weeks. Let's start with the SPIN questions - SPIN stands for situation questions, problem questions, implication questions and benefit questions. In this blog article you will find out where SPIN can help you and how it works in practice when selling.

Continue reading

Solve team conflicts in seven steps

I often come across ongoing conflicts in teams of all kinds. And while a certain amount of conflict in the team can contribute to the achievement of goals, some conflicts develop in a destructive direction. Both openly acted out conflicts as well as hidden and subliminal conflicts then inhibit cooperation and thus also the quality of results in day-to-day business or in projects. In this blog article, I explain my method for effectively resolving conflicts in the team.

Continue reading