Making Smart Investing Decisions

Investing like life is all about making choices. We make hundreds of choices every day. Most of them unconsciously like stopping at a stoplight, brushing your teeth and choosing how we respond to people and events in our lives. When someone cuts you off on the freeway do you choose to respond with anger, empathy or just a calm reaction to avoid a collision? Maybe they didn’t see you. Maybe they just found out someone they love died. Maybe they are in a hurry to get somewhere and fearful if they are late they will make a poor impression.

At the core there are two emotions that make a great difference in how we feel and the choices we make every day. Those are Love and Fear. Simply put Love is moving toward something. Fear is moving (or running) away from something. Love is responsive. Fear is reactive. Thomas Jefferson in the United States Declaration of Independence wrote, “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights that among these are Life, Liberty and the pursuit of Happiness.”

The pursuit of happiness is best served by making decisions from Love. Not a whole lot of happy or successful people making choices from fear. Why do most investors left to their own devices make investment decisions out of fear? One reason is when they watch financial news on TV or read what many pundits write about they are bombarded by extreme fear based perspectives. Most network TV; most movies are designed to engender fear and related emotions. The psychology of this is interesting. Why are so many so attracted to extreme fear based media? That is a topic for another time.

The bottom line is being a successful investor isn’t all that different than being a successful business person, successful husband, wife or partner. It starts with making choices based on Love, what you are moving toward that brings joy and as Thomas Jefferson so eloquently said, “Life Liberty and the Pursuit of Happiness.”   That it’s not that difficult would not make the evening financial news. Being in a diversified portfolio, ignoring the news and the day to day, month to month and year to year market gyrations is the secret to successful investing!

Mark D. Erwin is an Investment Advisor with, and offers securities and advisory services through: Commonwealth Financial Network Member FINRA/SIPC a Registered Investment Advisor

To learn more about Mark Erwin, view his Paladin Registry profile.