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The Art of Investing

6 unique perspectives from finance thought leaders

In the finance world, wisdom typically stems from a fusion of experience, knowledge, and shrewd interpretations of past trends. I set out to engage with six thought leaders and finance experts from varied backgrounds and specializations, inviting them to offer their insights and top investing tips. Here are their collective thoughts, which I trust will inspire you to discover fascinating individuals you may not have known and to ignite novel ideas for your financial management.

Enjoy the read😉

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1. The importance of discipline

Thierry Borgeat, Co-Founder of arvy and a LinkedIn Top Voice in Finance, underscores the necessity of saving as the bedrock of any investment strategy. He advocates for a pivotal mindset shift: give priority to saving rather than spending, and infuse your investing with the discipline of earmarking funds before considering any purchases.

His top three tips are:

  1. Start your investment strategy with saving. Instead of saving what remains after spending, spend only what is left after saving. Allocate a dollar to yourself before you think about any purchases.
     
  2. The S&P 500 has averaged a return of about 10% annually over the past century. Avoid attempting to time the market or overthink the start time. The prime time to begin investing was 20 years ago, but the next best time is now.
     
  3. Embrace these three essential rules for long-term investing: start early, reinvest earnings, and maintain wide diversification.

2. The “Positive Oscillations Process”

Olus Kayacan, an Independent Strategic Advisor and a LinkedIn Top Voice, champions a conservative approach that prioritizes capital preservation. He highlights strict risk management and setting clear boundaries to steer clear of emotionally driven investment decisions, striving for consistent growth and emotional resilience.

Olus advice:

"When I venture into new investments or develop a new portfolio, I prioritize strict risk management above all else. This is not just about protecting financial assets; it is about protecting our peace of mind. I firmly believe in setting clear boundaries to prevent significant losses, ensuring that I never find myself in a position that becomes emotionally overwhelming.”

3. The need to consider yourself your best investment

Dr. Efi Pylarinou, a global Fintech & Tech Thought Leader, Author, and Speaker, shares an often-neglected investment principle: self-investment:

“We all look for high returns on investments (ROI). An underestimated financial principle is investing in yourself. Think of it this way: If you don't invest, there will be no Return on Investment. Investing in yourself can take different forms. It can be taking a knowledge enhancement or a soft-skills course, buying a membership in a network, subscribing to a service that frees up time for you, or engaging a coach in area that matters most for you. Start by investing in yourself at least 10% of your annual income.”

4. Look beneath the surface

Victor Cianni, Chief Investment Officer at Alpian, acknowledges the variety of financial journeys, noting that your entry point into investing—be it equities, real estate, or digital assets like cryptocurrencies and NFTs—is less significant than your comprehensive understanding of those assets. He encourages investors:

“There are literally millions of ways to invest, with thousands of different asset types and thousands of approaches to choose from. Whatever path you choose, look beneath the surface. Either by gaining a deep understanding of the assets you are investing in or by expanding your knowledge to other asset classes. You will detect similarities. There is also only one way to lose money: by being in the wrong place at the wrong time. While this isn't always avoidable, the good news is that you have some control over it.”

5. Setting goals is essential

Dr. Martha Boeckenfeld, recognized among the Top 100 Women of the Future, a Web3 Advisor & Investor, and a UN Peace Ambassador, emphasizes the importance of SMART goals in financial planning, especially for beginners:

As someone who's learned the value of financial planning, I recommend starting your investment journey with SMART goals. Make them Specific, Measurable, Achievable, Relevant, and Time-bound. Whether your aim is retirement security, owning a home, or funding your child's education, having clear objectives and understanding your risk tolerance is key.”

6. Leverage the contrarian view

Stephane Renevier, an Analyst at Finimize, presents a contrarian perspective, suggesting that when investment trends become mainstream media fodder, it may be time to wager against them. He explores the "magazine cover indicator," which has historically indicated success for those who challenge the prevailing sentiment:

 “When an investing trend becomes big and well-known enough to be splashed across the cover of a major magazine, it’s often time to bet against the trendDoing so can be an effective strategy. And that’s because markets are forward-looking and anticipate what’s next, behavioral biases make it more likely that prices will temporarily deviate from fundamentals, and supply and demand dynamics play an important role in bringing outsized moves in check. The magazine cover indicator has a pretty strong success record. Taking positions against The Economist’s cover stories would have made you a roughly 10% gain in your investment over the next year – regardless of whether it’s on the long side or short side.”
For a detailed analysis on the magazine cover indicator refer to the following article.

In a nutshell the collective insights of these thought leaders offers a comprehensive perspective of investment strategies: the need for a disciplined saving habit, the power of compound interest, the protection of capital, personal development, goal setting, and the value of contrarian thinking. By integrating these principles you can create a well-rounded approach that stands the test of time and market fluctuations. Remember, investing is not just about the accumulation of wealth; it's also about the journey of continuous learning and personal growth.

P.S.: the original of this article in German has been published on Watson News

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