Avid golfers appreciate the game of golf for its unhurried pace, the chance to enjoy the outdoors, and the addictive feeling of making a great shot.
Surprisingly, there are actually a lot of similarities between the game of golf and investing.
If you golf, you've already got a head start on understanding how to make your money grow. If you don't golf, you should at least try –– it's a great game.
1. Don't Let Your Mind Interfere With the Game
Golfers who let their emotions run wild will be on the fast track to having all balls in the rough, out of bounds, or in the sand (which is bad). In much the same way, investors cannot be ruled by their emotions. Fear, greed, and overconfidence are powerful emotions that can lead an investor
to make poor investment decisions.
For example, an exceptionally risk-averse investor might sell a position that has lost 10% of its value within a short period, only for it to recover shortly thereafter. Alternatively, an exceptionally confident investor might believe he can consistently beat the market - resulting in more trades, higher trading fees, and possibly lower overall gains.
2. Learn from the Masters
Golfers can learn a lot of tips from golf greats such as Tiger Woods or Phil Mickelson, whose golf swings have been studied by both amateurs and professionals. Similarly, novice and sophisticatedinvestors can learn a lot from investing giants such as Warren Buffett, Peter Lynch and George Soros.
The strategies that these investors followed vary widely, but can allow you to gauge the type ofinvesting strategy that is best suited for your risk tolerance and goals.
3. Be Wary of Friendly Advice
Stock tips from friends are similar to golf tips from friends - you may have no way of knowing whether your friend's a "duffer".
The hot stock tip you hear that is "sure to be a winner" could land your net worth in the bunker if you don't perform further research into the validity of the claim.
See the rest of the story at Business Insider
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