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exhibit it. It means knowing, as the song says, "when to hold 'em and when to fold 'em." Learning this only comes with self-insight, a disciplined mind, emotional control, and a wide behavioral repertoire. And it doesn't come overnight. |
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In this chapter, we have identified a number of investor types, giving examples of the common personality traits and investing behaviors that go with each of them. We made the point that it is important to understand our own investing biases so that we may take them into consideration when we trade online. With awareness, we may choose to compensate for these "built-in" biases. |
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We said that when we choose to ignore the effects of our personality on our investing choices, we are going to repeat the same mistakes over and over. And, of course, we will not know why we are making these repeated mistakes. |
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I suggested that the most complete and balanced online investorour "perfect" investorwould have a combination of traits derived from the various trader types. |
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So, for example, he or she would have a healthy measure of the obsessive-disciplined type, a dash of the gambler-impulsive, one part optimist (without the naiveté), and one part of the doubter-timid (to know when to err on the side of being conservative). There is, however, no place in the mentally healthy online trader for any part of the victim-blamer type. |
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Finally, questions were asked to help you begin to think about your present identification with a trading type and how you might like to develop other traits and behaviors so as to become a more balanced trader/investor. |
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In the next chapter, we will tackle the major psychological emotions of greed and fear with the first chapter in our trilogy. We will continue to look at ways we may find balance. |
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